The crypto community is preparing for a grandiose event on its scale – the refusal of the leading altcoin from the work of miners in favor of validators. After the developers approved September as the closest move date, Ethereum jumped by 65% in 30 days and surpassed Bitcoin in growth rates this year.
In the derivatives market, open interest in Ethereum has overtaken Bitcoin for the first time in history, and derivatives traders are betting on altcoin growth to at least $2,200.
The transition from PoW (proof of work) to PoS (proof of ownership) is called a merger, since all the key network parameters will be moved to the test chain developing in parallel.
To stimulate the merging process, a complexity bomb will be activated in the PoW branch, which will lead to its natural death. The complexity bomb exponentially increases the complexity of mining, making it less and less profitable.
Miners will have to migrate to other networks to generate income, for example, to Ethereum Classic. However, not everyone agrees with this role. So, a major Chinese miner Chandler Guo proposed to “clone” Ethereum by creating an ETHPOW token. Some crypto exchanges have already supported this idea by issuing appropriate futures. In particular, Poloniex, MEXC and BitMEX did so, and Binance expressed possible support for the fork.
ETHPOW has chances only if it is picked up by an impressive proportion of miners.
At the moment, many doubt the expediency of the next branching, since the parent branch on PoW already exists – this is Ethereum Classic. In addition, the leading operators of stable coins – Tether and Circle – have officially announced support exclusively for the PoS branch.
Despite the imminent abandonment of mining, miners are in no hurry to leave Ethereum. Thanks to the latest price increase, the mining yield increased from 1.4 cents in July to the current 2.8 cents per MH/s. So, the newest asic E9 from Bitmain generates about $65 of daily income and reaches self-sufficiency in 6-8 months.
The developers have designated September 19 as the “soft” deadline for switching to PoS. If everything goes smoothly, Ethereum will continue to strengthen against Bitcoin.