Ethereum Finally Switches to Proof of Stake – Is GPU Mining Now Dead?
Mike Sanders / 1 year ago
It’s been known for quite some time now that Ethereum was looking to apply a pretty dramatic change to the manner in which the cryptocurrency could be mined. – Although we will look at this in more detail shortly, the key distinction was a transition from a ‘Proof of Work’ standard to a ‘Proof of Stake’. – With this change now officially confirmed and in place (courtesy of TechPowerUp), however, this may come with some potentially excellent news for PC gaming consumers.
Put simply, with ‘Proof of Stake’ now required, it may have just resulted in graphics card-based mining being pretty much rendered (mostly) obsolete!
Ethereum Moves to Proof of Stake – A Huge Relaxation of GPU Demand?
Explaining the full difference between ‘Proof of Work’ and ‘Proof of Stake’ would likely take over 10,000 words, and even then, I’d probably do a pretty shoddy job of covering all of the key differences between them. The bottom line, however, is that ‘proof of work’ requires a monumentally huge amount of both processing power (don’t confuse this with solely CPU) and literal power (to run the masses of machines).
While a notably simpler system, its key disadvantage predominantly comes down to the cost of power consumption to effectively ‘mine’ in this way as well as the fact that completing transactions can take a fair amount of time. Additionally, there is a competitive nature to ‘proof of work’ which does often see more major organisations vying to control more complex blockchains.
So, what are the advantages of ‘Proof of Stake’? Well, ultimately it comes down to power consumption. With it being notably less complex, it requires a lot less computing power to calculate/validate which, in very basic terms, means that having masses of graphics cards on racks (for Ethereum at least) doesn’t really offer any advantage whatsoever. Additionally, this mining method also requires an ‘investor’ to place a stake in the cryptocurrency as a basic form of deposit. Should they be found to be attempting to ‘cheat’ the system, such as, for example, in submitting invalid work, they lose their deposit. – The system is also more (again in very simplistic terms) designed for people to invest in a potential return rather than attempting to create a stake purely for themselves.
What Does This Mean For Non-Miners?
Looking at this from a purely non-mining aspect, you might now be wondering how this transition to the new Ethereum will benefit you. Well, in the bluntest terms, graphics cards are now no longer a key component of mining this particular coin. As such, AMD, Nvidia, and their various AIB partners pretty much no longer have this market to cater to (and sell directly in many proven instances) their models towards.
While some coins do still utilise ‘Proof of Work’ systems, the biggest is Bitcoin which, as has been well proven over the years, is simply vastly more efficient on ASIC mining machines rather than graphics card-based setups. For those remaining that can take advantage of graphics card implementations, they are nowhere near as popular, prevalent, or profitable as Ethereum has been.
On a more global scale, however, this transition is expected to reduce global power consumption by as much as 0.2%. No, not a huge figure when written, but remember, this is the power consumption for the entire world which roughly translates to being about as much necessary to run 5 major first-world metropolitan cities!
Again though, the key point is that, by and large, graphics card-based mining is now mostly dead. And with new GPU models just around the corner, presuming everything pans out as expected, Ethereum finally making the switch to ‘Proof of Stake’ should be truly phenomenal news for us humble gaming PC consumers!
Yes, in a nutshell, AMD and Nvidia, we’re all you’ve got left now!
What do you think? – Let us know in the comments!