Ethereum Miners Flock to Classic Network Following Historic Merge
Following Ethereum's transition to proof-of-stake, displaced miners are shifting their computing power to the Ethereum Classic network. This migration threatens to offset some of the environmental benefits expected from the Merge.
Ethereum miners who lose their jobs due to the new proof-of-stake system find a new home on the Ethereum Classic network. The hash rate of this alternative blockchain soars to a record high immediately after the completion of The Merge. Because these miners have significant investments in computing hardware, they refuse to quit and instead pivot to this hard fork that still relies on the traditional proof-of-work method.
Ethereum Classic originates from an ideological split in 2016 when a faction of the community chose to preserve the blockchain's immutability rather than reverse a massive hack. Today, it remains a much smaller network than mainstream Ethereum, holding a market cap of roughly $5.3 billion compared to Ethereum's $195 billion. However, its continued use of the energy-intensive proof-of-work mechanism makes it the only viable option for miners with nowhere else to go.
This sudden influx of mining power potentially undermines the environmental benefits of Ethereum's green upgrade. As one displaced miner explains, the massive rigs and facilities require a network to operate, meaning energy consumption simply continues on a different blockchain. This shift highlights how the original mining gold rush not only created huge profits for equipment makers like Bitmain, but also contributed to the global chip shortage in recent years.