Observation | 4G graphics cards "expired" ETH2.0 is coming, where will Ethereum miners go?

In 2020, the most profitable and eye-catching cryptocurrency is Ethereum. Whether it is DeFi or ETH2.0, Ethereum is increasingly being called the catalyst for the bull market.

However, for Ethereum miners, time is running out for 4G graphics card mining machines.

The sword of Damocles hanging over the miners' heads

As we all know, the Ethash algorithm consumes a lot of graphics card memory and is a memory-hard algorithm. Specifically, the Ethash algorithm requires that the verification information of the new block contains the encrypted information of all previous blocks, which is the DAG file (DAG is also called directed acyclic graph). This file needs to be stored in the graphics card memory during mining. Therefore, to mine Ethereum, the graphics card memory must be larger than the current DAG file size.

In June 2016, Ethereum adopted this design in algorithm optimization. Since then, this DAG file has continued to grow at a rate of about 520M per year, and by December 2020, the file is expected to reach 4G.

According to data from investoon.com, the current Ethereum DAG file is 3.91G, and it is expected that by December 25, the DAG file will reach 4G. The DAG file of Ethereum Classic, which is of the same root and family, has already reached 4G. This means that 4G graphics card mining machines will no longer meet the conditions required for Ethereum mining, and will be completely wiped out.

Time is running out, and the sword of Damocles hanging over the heads of 4G graphics card miners will eventually fall.

The way out for 4G graphics cards

A gentleman does not stand under a dangerous wall. If you want to continue mining Ethereum with a 4G graphics card, there are currently three effective solutions:

1) Since Linux system occupies less memory than Windows, switching the system can appropriately extend the mining life of the 4G mining machine. Currently, the mining software for Linux system includes minerOS, Miracle Moore, and Mine Treasure.

2) Expanding 4G video memory to 6G or 8G, the cost of a single modification is relatively high, miners need to calculate whether it is cost-effective based on their own situation.

3) Replace the graphics card with a high-capacity 8G one.

F2Pool co-founder Shenyu told Golden Finance, "There are two main ways to sell 4G graphics cards. The first is to refurbish the video memory, which is not bad. At present, many machines have replaced the video memory. The other is to refurbish and sell them in the second-hand market or to gamers. Overall, the value retention ability of graphics cards is good, and the demand is relatively large. However, compared with the beginning of the month, the price of second-hand 4G graphics cards has dropped a lot. For large miners, replacing the video memory may be more cost-effective, because these graphics cards have paid for themselves many times, and the extra cost is not high for everyone."

Shenyu further pointed out that the underlying logic of the residual value of 4G graphics cards is actually the support of other currencies, but there are not many currencies that can be mined at present, or there are not many currencies that can support a large number of 4G graphics cards . At present, the value of 4G graphics cards may only flow back to the game market, especially the low-end market. For small mining coins, there may be some opportunities to carry the computing power of graphics cards and have some innovations of their own in this process.

How long can miners continue to mine?

In fact, miners are not only facing the problem of mining machines. As Ethereum 2.0 is getting closer, miners will also be nervous. How long can they continue to mine? In the process of transitioning from PoW to PoS, how can they obtain the greatest value?

Shenyu told Golden Finance that during the PoS conversion process, it may run in parallel with PoW for a period of time and then switch. No one knows the specific time and cycle, and the official progress is not certain. However, for miners, once the switch or partial switch occurs, it will definitely have a huge impact on their profits.

From the perspective of miners, Shenyu believes that they cannot obtain any value, because miners mine and protect the network through computing power. When the Ethereum network transitions to the PoS stage, PoW miners are no longer needed. The current benefit to miners is that the ETH in their hands will bring some changes to the currency price as the throughput capacity of the Ethereum network increases and the economic model is iterated, but for miners themselves, this matter is not good.

"Miners will be concerned about the sustainability of POW mining, so they should be cautiously optimistic . From the recent decline in machine prices, we can see that they are not likely to blindly increase their chips. The machine upgraded from 4G to 8G can still mine for 4 years." Cao Jun, co-founder of Spider Mining Pool, said, "For miners, hedging at high prices can maximize the profit. It is also a good choice to purchase new machines for rolling investment after mortgage loans. "

BTC.com CEO Zhuang Zhong said that Rome was not built in a day. The ETH beacon chain only supports the Staking function. The Phase 1 sharding will be launched in 2021. After the launch, it can only be run on a trial basis and still does not support transfers and smart contracts. The new virtual machine eWASM in Phase 2 and the accompanying smart contracts and cross-shard transfers will take a long time to implement. ETH2.0 will not affect PoW miners in the next few years. The eventual replacement of PoW requires ETH2.0 to be successful enough. During this period, miners with large video memory can enjoy the increase in revenue after the decline in the computing power of the entire network for a period of time. The first phase of ETH2.0 will attract a certain amount of ETH to lock positions, which will be more beneficial to these miners.