The most anticipated consolidation in the crypto world has left many miners unemployed.
Ethermine, the largest Ethereum mining service provider, has closed its servers to miners after the Ethereum blockchain network completed a historic technical upgrade.
The upgrade called ‘Merge’ (or The Merge) that moved Ethereum from a PoW (Proof of Work) mechanism to a PoS (Proof of Stake) mechanism took place this afternoon. September 15th.
The merger means that miners can no longer mine ether on the network, as their graphics cards were previously designed for PoW only. The PoS mechanism will also help save more energy by only doing the authentication task.
The Merge also means that no more ether can be created and the supply is limited, pushing up the price of ether rapidly. Just an hour after The Merge took place, the price of this cryptocurrency skyrocketed from $ 1,500 to $ 1,600.
A few days after The Merge, Ethermine will trigger an automatic payout to previously unpaid miners. To accommodate the new PoS mechanism, the company also established an Ethereum staking pool in August where ether holders can deposit and earn profits.
In just a few years, ether mining has grown into a multi-billion dollar industry. In its heyday, up to a million people and over $10 billion worth of computing equipment were mining ether together.
Millions of Miners Will Be Abandoned After “The Merge”
Under the PoW mechanism, miners and their computers have to compete with each other to solve mathematical puzzles. The fastest winner will be rewarded with a digital currency.
Mining pools like Ethermine aggregate computing power from a pool of miners to increase the probability of winning ether before distributing rewards among miners. Companies like Ethermine often charge extra fees for providing services to generate revenue.
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