Ethereum Miners Make Multimillion-Dollar Bet on Upgrade Delay

Major bitcoin mining firms and miner manufacturers are increasing their investments in ethereum mining despite the second network’s impending switch to proof-of-stake. Public bitcoin mining companies Hut 8 and Hive are increasing their capacities to mine the second-largest cryptocurrency by market cap. In the meantime, miner makers like Bitmain and Innosilicon are set to release new ethereum mining machines later this year.

This investment may seem strange, given that the Ethereum system is anticipated to migrate from proof-of-work (POW) to proof-of-stake (POS) in five months, and POS mining does not require such advanced machines. The rising demand might be attributed to expectations that the migration will be delayed, industry pros said.

“We were told mining was going to end four years ago and it is still going,” said Mark D’Aria, CEO of Bitpro, a New York-based consulting firm with a focus in brokerage and management of Ethereum mining hardware. “It has always been a wait-and-see approach – things tend to take longer than everyone expects.”

While last week’s London fork brings the network one step closer to Ethereum 2.0, significant upgrades throughout Ethereum’s six-year history have a track record of multiple delays.

Ethereum Improvement Proposal (EIP) 3554 introduced the difficulty bomb that adds artificial miners to increase mining difficulty, making mining operations less profitable. This period has been referred to as the “Ice Age.” Ethereum developers initially presented this EIP in 2015, but it has been postponed to December 2021.

Ethereum Miners Make Multimillion-Dollar Bet on Upgrade Delay, CoinDesk, Aug 13