Will Ethereum Classic replace Ethereum after The Merge?
The Ethereum Community has been waiting for The Merge for years.
The Ethereum Difficulty Bomb has been delayed time and time again, but the official date has been announced. It will be on September 19th that Ethereum Proof of Work will switch to Ethereum Proof of Stake.
Analysts are focusing on the miners that the Ethereum Network will not really need after The Merge. There is a lot of talk about the rise of Ethereum Classic after The Merge.
That is why we decided to interview exclusively the Executive Director of Ethereum Classic Cooperative, Bob Summerwill.
So what is the mining’s future after The Merge?
The end of Ethereum Proof of Work with The Merge
At the origin, Ethereum required a significant amount of computing to create and distribute cryptocurrencies. This is called mining. Mining brings together thousands of enthusiasts and professionals around the world who make their computing power available to validate transactions and receive rewards.
But with Ethereum 2.0, mining and Proof of Work will be replaced by staking and Proof of Stake. This update is intended to revise the way the network works. Ethereum mining as we know it will become obsolete!
So, what future for Ethereum miners?
“Ethereum Miners Will Have Few Good Options After The Merge”, according to Forbes Crypto. For the Ethereum developers’ schedule, the Merge will take place at block number 58750000000000000000000000. This number will probably fall between September 15th and 16th. It is on September 19th that Ethereum will migrate to the Proof of Stake to further secure it.
The Ethereum Network will no longer need miners. Today, miners will have to turn to other cryptocurrencies that are compatible with their hardware like Ethereum Classic.
Ethereum Classic explained
As we announced earlier, we had the honor of interviewing Bob Summerwill, the Executive Director of Ethereum Classic Cooperative. Let’s go for an interview about the future of Ethereum Classic and its presentation!
Can you introduce us to Ethereum Classic?
Bob Summerwill: Ethereum Classic was “birthed” at the time of the DAO Fork in 2016. The DAO was the first major DApp to launch on Ethereum and was holding a significant chunk of the total ETH. It was hacked, and there was a month-long debate within the community of what to do – whether to do nothing (“Code is law”, “There was no bug on-chain, just in a particular application, tough luck!”) or whether to hard fork an irregular state transition which essentially “undid” the hack.
The majority of node operators chose to hard fork and that forked version was recognized as Ethereum, with the Ethereum trademark being used for that, and all of the funds which the Ethereum Foundation held being used only for Ethereum. The continuation of the original chain was called Ethereum Classic, and did not “undo” the hack. The supporters of Ethereum Classic felt so strongly about immutability of the chain and that “forking out” the issue was a permanent taint on that chain, was against the whole ethos of an immutable, unstoppable, uncensorable chain, which was the whole point of blockchain in the first place.
The Ethereum Classic Community was entirely composed of volunteers at the start, together with a handful of miners who mined the existing chain until exchanges got on board and Ethereum Classic was listed, and then came back to life. Since then various companies and teams have supported Ethereum Classic at different times, with Grayscale as the largest financial supporters.
The Ethereum Classic Cooperative is a non-profit supporting Ethereum Classic which now funds core development of two clients (Hyperledger Besu, Core-Geth), a block explorer and public RPC endpoints. Antpool recently came onboard and pledged $10M of funds to support Ethereum Classic.
Ethereum Classic has a lot of liquidity and a very broad range of exchange listings, mainly due to its long history. If you look at Proof of Work Chains on CoinMarketCap you will see that Ethereum Classic is #4 by market cap and #3 by daily trade volume within that segment of the market.
There is a fairly small DApp ecosystem on Ethereum Classic, but it is growing fast in the last year or so. We have many NFT projects, two different DEXes, bridged stablecoins and various DAO projects.
What are the values and purposes of Ethereum Classic? Why to choose Ethereum Classic instead of another coin?
BS: Ethereum Classic can be explained as Ethereum technology with Bitcoin philosophy. That could be seen clearest in the DAO fork, where the community felt so strongly about immutability and non-intervention that they walked away from hundreds of millions of dollars of funding and support.
The Ethereum Community really had two different groups of people from the start. Those two wanted programmable hard money and those who wanted “World Computer”, where Ether was not seen as money, but as fuel for running the engine. A platform for decentralized applications. The Ethereum/Ethereum Classic split was the first place where that tension came to the surface, but it will be even clearer with the pending Merge of Ethereum, transitioning to Proof Of Stake, where Ethereum Classic will stay with Proof Of Work in the long term.
If you are looking for programmable digital gold, with a fixed emissions schedule where security and immutability are valued over scalability then Ethereum Classic is the place for you. Many are also attracted specifically by Proof Of Work, with fears that Proof Of Stake will be subject to social attack vectors which Proof Of Work will not. An example of this is the OFAC sanctions applied against Tornado Cash which have led to fears that Ethereum Proof Of Stake staking pools in the US will be forced to censor transactions.
Is Ethereum Classic secure?
BS: Yes, very safe. This extensive report recently published quantifies that security: https://github.com/meowsbits/51-percent-docs/. We have more than 10x the hashrate since the time of the 2020 attacks and introduced two different protocol changes directly in response at the time.
The first change was a tweak to the hashing algorithm, called Etchash. This change halved the size of the DAG and halved the rate of growth. This allowed 2GB and 3GB GPUs to return to hashing Ethereum Classic and resulted in a large jump of hashrate at the time, which secured the network.
Plus, Ethereum Classic did not “leave NiceHash” so much as Nicehash chose not to support Etchash, meaning that NiceHash could only be used for Ethereum rentals, not Ethereum Classic rentals after that point. By the way, each of the 51% attacks against Ethereum Classic in last 2020 were conducted with NiceHash rentals, so this was actually a good outcome. At the time, NiceHash claimed they could not distinguish between rentals for Ethereum and rentals for Ethereum Classic being used to attack the cryptocurrency. It is entirely possible for NiceHash and other rental services to rent Ethereum Classic hash again in the future. Perhaps that will happen when Ethereum mining ceases at The Merge.
For more infos: https://ecips.ethereumclassic.org/ECIPs/ecip-1099.
How do you handle the Ethereum Classic community?
BS: There is no Ethereum Classic Foundation, no premine, no ICO, no centralized entities within Ethereum Classic. Everything is oriented around the protocol and any individual or legal entity who sees value in the Ethereum Classic Network can use it as they see fit, can participate in the ecosystem and can contribute support and funding. Ethereum Classic is credibly neutral in a way which few blockchain projects can claim. Ethereum Classic did not quite have the “virgin birth” of Bitcoin, but is certainly close.
There are Discord servers, Twitter accounts, a community-maintained website, a community-maintained GitHub organization which contains the website and the ECIPs (Ethereum Classic Improvement Process) which is used for proposals to change the Ethereum Classic Protocol.
The Ethereum Classic Cooperative holds around $5M which is used to support basic infrastructure and will be used shortly to launch a new open grants process. In the past the Coop has held the yearly Ethereum Classic Summit conference and provided grants for various projects.
Ethereum Classic predictions after The Merge
How do you feel about Ethereum Classic after The Merge?
BS: With the new funding from Antpool on top of the existing Ethereum Classic development I see a rich DApp ecosystem building on Ethereum Classic in the coming years. The protocol itself is unlikely to see many changes, but the layers on top will see significant growth.
Will Ethereum 2.0 affect Ethereum Classic?
BS: Yes. There will likely be a significant migration of Ethereum miners to Ethereum Classic, improving the security of the chain even further and bringing “power users” into the ecosystem in the form of those miners. They are strongly incentivized to support the chain. We anticipate some Ethereum Projects migrating to Ethereum Classic (or supporting both Ethereum and Ethereum Classic Instances), and the launch of alternative but similar projects as well. We anticipate native stablecoins and all of the rich DeFi primitives coming to Ethereum Classic soon.
Ethereum Classic fees are significantly cheaper than Ethereum at the moment, which is obviously attractive for some scenarios, but that is just indicative to a significantly lower volume of smart contract transactions at the present. Another thing to note for Ethereum Classic is that we have not suffered the extreme chain bloat of Ethereum at the time of interviewing, so a full sync on a commodity laptop is still very possible on Ethereum Classic, with the blockchain size being around 50 GB versus ETH’s 345 GB.
How many Ethereum ASICs do you think will migrate to Ethereum Classic after The Merge?
BS: It is not really possible to know, but my expectation would be a significant proportion. The only alternative for this hardware is to sell it (To who? For what?) or just to write off the cost and ditch the hardware. There are not any other Ethash chains with any significant market cap to absorb that hashrate. The Ethereum Proof Of Work fork might absorb some of that hashrate in the short term but I see no long term future for that chain beyond the initial dump.
We have not performed tests, no, because that work would require huge volumes of hashrate which are not freely available. If you look at the 51% attack security analysis, there is a calculator which can be used to explore scenarios with different values. Based on this and other analysis, we feel confident in our security.
There is a natural balance within Proof Of Work Chains where appropriate market value is discovered as hashrate migrates. Too many miners will result in lower block rewards per miner, at which point the miners with lower efficiency will find themselves mining at a loss, and will likely be forced to stop mining, as their business no longer makes sufficient revenue to survive.
Both for ASICs and GPUs currently mining Ethereum it will be the case that this will be the end of the road for a large proportion of them, sadly.
Do you want to add something to close this interview?
BS: I would just welcome all miners to come and check out Ethereum Classic. Join the Discord servers, follow Ethereum Classic accounts on twitter and check out the various mining pools like Cruxpool and exchanges which support Ethereum Classic. The migration will not be difficult.
Ethereum Classic is very miner-friendly, with no real interest in the ecosystem even to explore Proof Of Stake. We will be around for decades to come.
Community Discord: https://discord.gg/TAyX8JK6
- Community Website: https://ethereumclassic.org/
- Ethereum Classic Cooperative Website: https://etccooperative.org
- Primary Twitter handle (not “official”!): https://twitter.com/eth_classic
- Ethereum Classic Cooperative Twitter handle: https://twitter.com/eth_classic
- My twitter handle: https://twitter.com/bobsummerwill
- Fantastic site for background reading: https://etherplan.com/
Which Ethereum Classic mining pool to choose?
On Cruxpool, you can mine Ethereum Classic because we want to support Proof of Work projects, allowing anyone to participate and spread the hashrate.
As Bob Summerwill said, it is a cryptocurrency suitable for everyone since it requires at least a GPU with 2 and 3 GB VRAM.
You can check our GPUs mining performance pages to know how profitable your hardware is by mining Ethereum Classic!
We have a PPS Ethereum Classic mining pool that helps miners get a stable revenue. Plus, Ethereum Classic mining has a 1% fee.
In addition, we pay transaction fees for Ethereum Classic mining!
After The Merge, miners will no longer be able to take advantage of Ethereum Proof of Work. They will therefore have to turn to cryptocurrencies like Ethereum Classic a promising coin.
Ethereum Proof of Work will be remembered as a very lucrative network from until now. Its financial return has surpassed that of mining on the Bitcoin Network. But with Ethereum 2.0, the place will be for staking.
What if you start mining Ethereum Classic on Cruxpool?