Cryptomining has been one of the significant reasons for the scarcity of graphics cards. Whenever a new card drops, they are almost always sold out within a few days, if not hours. GPU-based cryptomining has been the most common way to mine coins, but the winds of change have arrived and it’s good news for gamers.
With the changes coming to Ethereum mining, gaming graphics cards don’t seem as profitable an option. Also, given that China has decided to take action against cryptocurrencies, and it being a major hub for GPU-based mining operations, gamers can expect to see more graphics cards in the market.
However, the changes to Ethereum are going to take time, so don’t expect it to happen overnight. Or even this year.
Two major updates are coming to Ethereum, the first of which has been dubbed the “London Hard Fork.” Ethereum developer Tim Beiko has confirmed on Twitter that this change will go live on August 4th, 2021, which is less than a month away.
The “London Hard Fork” is a precursor to the Ethereum 2.0 update that will have a much more significant impact on the GPU shortage. The change consists of five Ethernet Improvement Proposals (EIPs), and as reported by CoinDesk, the most notable ones are EIP 1559 and EIP 3554.
EIP 1559 brings a change to the fee structure by bringing a minimum fee to all on-chain transactions. Currently, users set transaction fees that miners accept. This will now be replaced with a “base fee,” which is automatically set by the Ethereum protocol, which gets removed or burned from the network instead of being rewarded to the miners.
Basically, this change will potentially decrease the miner’s revenue. Obviously, not many are looking forward to this change, but it’s being done to make Ethereum less volatile.
While we think [EIP 1559] will bring better predictability for transaction inclusion, we think that fee burning is a bad idea, considering many transactions requiring extended computing resources for smart contract execution… will no longer be compensated.Slava Karpenko, Chief Technology Officer of Ethereum mining pool 2Miners
EIP 3554 has been dubbed a “Difficulty Bomb Delay” and has been created for when Ethereum mining will become more difficult after the Ethereum 2.0 update. As long as there are no more delays along the way, this change is likely to be enacted by December 1st, 2021.
This is the big change that all gamers should keep in mind, as it could effectively end graphics card mining. Maybe not entirely, but Ethereum is the biggest cryptocurrency that is still being mined using GPUs instead of specialized ASIC hardware, which is mainly used for currencies such as Bitcoin.
This requires a change from what is known as a proof-of-work model, where mining requires a great deal of computational power to shift transactions and generate new Ether. A proof-of-stake model means that the network itself will verify the transactions (or blocks) according to the miner’s existing stake in Ethereum.
If this happens, it is conceivable – and quite probable – that many Ethereum miners will throw in the towel and sell off their GPUs. Of course, the industry-wide shortage of silicon is still ongoing, but a flood of used cards in the market coupled with a reduced demand for GPUs should help the situation.
The delay of the update to December 1st does mean that the GPU scarcity will continue all through this year. We’re hoping that as the change comes into effect, GPUs become more readily available in early 2022. However, this too could change if a currency that can be mined with GPUs becomes super popular.