After the Ethereum Merge: A Post-op

On September 15, 2022, Ethereum transitioned to PoS.

After years of planning and development, the ‘merge’ is successful. The impossible has been accomplished.

In this article, we’ll go over a few essential details as a merge ‘Post-op’.

– Energy usage

– GPU and Gaming

– Emissions changes

– PoW forks

– Next steps

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There is never a dull moment in our ecosystem. This is especially true at important points in its evolution.

This was demonstrated again this week.

Someone paid ~$50k (30 ETH) in gas to ensure the last Ethereum PoW block was a vanity block NFT. Forever at the end of the PoW chain, on-lookers will now see the following image and text.

‘You make the commitment and nature will respond to that commitment by removing impossible obstacles. Dream the impossible dream and the world will not grind you under, it will lift you up. This is the trick.’

Moments and displays like this are why I love this space so much.

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Following the upgrade, Ethereum’s energy usage dropped ~99.5%.

Vitalik estimates that the change to PoS reduced Global energy usage by 0.2%. This makes it one of the most significant de-carbonization events ever.

You can imagine the impact if Bitcoin were to shut down and somehow move away from PoW. I don’t think that should or will ever happen.

The Bitcoin network’s security model is critical for its value proposition. The net carbon impact of Bitcoin’s PoW is not as simple as you might think as well.

Bitcoin mining helps offset carbon emissions and fosters clean energy production and reuse — a focus for a separate article at another time.

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Dropping PoW has another positive side effect — cheaper GPUs!

PoW relies on hardware mining, and miners are no longer profitable. Miners are selling their mining hardware in high quantities. As a result, GPU prices are dropping.

Second-hand cards are being sold, and new video card prices are also decreasing.

Good times to be a gamer again (smiley face).

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Since the merge, the ETH emissions rate has dropped by about 15x.

That’s 15x less ETH entering the supply since the change from PoW. Emissions will decrease by about 10k ETH/day, with some variance.

Here’s a chart from ultrasound.money showing the current emissions rate and a comparison to a PoW simulation.

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Who would have thought copying the Ethereum state would be so complicated?

ETH PoW forks are facing significant technical glitches. As a result, we can conclude they are currently a failure.

Leading up to the merge, the mining Hashrate dropped quickly.

The prices of ETHPOW and ETHW (alternative fork on Poloniex) crashed shortly after the merge as traders cashed in on their forked coins.

ETHPOW

Mining PoW forks does not provide much meaningful financial incentive either.

medium.com