Who will be the future king of PoW: ETC or ETHW?
1.What course do miners follow after Ethereum upgrade?
On March 15, 2022, the public test network Kiln was launched, representing a successful transition and upgrade to a full PoS mechanism. On June 8, 2022, Ether completed the first dress rehearsal for Merge — the test network Ropsten successfully completed the merge, which was considered near-perfect on Ropsten and became an important milestone in Ether’s migration to PoS. The recent Goerli test network merger will be the final dress rehearsal for the Ether merger, and if all goes well, the main Ether network is expected to complete the merger on September 19.
Due to the distributed nature of the ethereum mining industry, the ratio of ASIC to GPU miners is difficult to determine. Michael D’Aria, CEO of BitPro, estimates that 90 percent of miners are GPU-based, while the other 10 percent are ASIC-based. Bitsbetripping host Michael Carter, who specializes in crypto mining consulting, holds the opinion that 20–30% of miners on the network are ASIC-based miners.
The problem with Ether ASIC miners is that they can only be used for ETH mining and cannot be repurposed for other applications. Ethereum Classic is the only other PoW cryptocurrency that can be mined with Ether ASIC miners, as its hash algorithm is compatible with that of ETH. If mining Ethereum Classic is unprofitable, then there will probably be no resale market for ASIC miners, and they will be discarded after the Ether merger. In addition, we also think that Ether miners will fork the merged Ether, so that they will be able to continue mining on Ether, with the main risk being whether the forked Ether will still have the value of the current Ether.
After the Ether merger, GPU miners became the only Ether mining hardware that could be repurposed for other applications. After analyzing a large number of GPU miner repurposing options, we believe that GPU miners have several other uses as follows
o Mining other PoW tokens
o Providing data centers for high performance computing
o Providing computing for the Web3 protocol
2.Is ETC expected to rise?
ETC and ETH originally belonged to the same chain, and in a hacking incident ($50 million worth of ETH was stolen in a crowdfunding in June 2016) the community argued about whether there should be a hard fork, and eventually most community members supported a hard fork, and the chain after forked was the current ETH, while the original one was ETC.
For now, the ecological construction of ETH and hash rate exceeds of ETC, but ETC also has the following values.
- Values: ETC has established itself as a truly transaction-irreversible blockchain by refusing to retrieve funds from DAO attackers, and it is its support for decentralization that provides the constant impetus for ETC’s continued growth.
- Economic Value: ETC follows the tradition of Bitcoin and supports the Austrian school of economics tradition by planning a reduction in production along the lines of Bitcoin, with a final total issue of no more than 230 million. Proponents argue: “If there is no scarcity, then what is the difference between a digital currency and fiat currency? At best, it pairs miners with real-world central banks.” Thus for now, ETC has a clear monetary policy and its limited production is in line with expectations for its investment.
- PoW value: the core of blockchain is consensus mechanism, POW mechanism based on proof of workload has been proven to be the best system in the market, eight of the top ten digital cryptocurrencies in terms of total market value are based on POW mechanism.
The earliest POS mechanism proposed by the PeerCoin, has almost died out. The setup that owning the coin itself will generate more coins will lead to a serious Matthew effect, making the rich richer and the poor poorer. If we can’t make the result fair enough, we can at least make the mechanism fair. For POW, miners can always choose to mine or not to mine some kind of token; while for POS, latecomers lose the opportunity to participate at all.
Considering the fact that ETC has the above values, Vitalik Buterin has spoken publicly to support the development of ETC on ETH upgrade, and the coin price of ETC has also realized a wave of rise recently, the future development of ETC still needs more funds and miners to join.
3.How to predict the future price of ETC?
By analyzing the reasons for the past 4 significant increases in ETC, we conclude that ETCs are rising mainly because of.
- Gaining investment.
- The aftermath of block production reduction.
- Increase number of miners.
Since ETC’s next production cut is in 600 days, the price of ETC in the near future will be mainly affected by the ecological construction investment and the change in the number of miners. Especially, the change in the number of miners is a data we need to pay close attention to in the near future because the upgrade of ETH means that the original miners of ETH will need to shift to mining other coins, and ETC official also issued an article to support the miners of ETH to mine ETC after the upgrade. If a considerable part of Ether miners eventually migrates to ETC, the hash rate will soar, causing a sharp climb on the difficulty of mining and driving most miners out of the profit zone. The only way for most ETC miners to remain profitable is for the price of ETC to increase by several orders of magnitude. If the hash rate keeps growing, then we can predict that miners will keep pulling the ETC price, and if there is a stagnation, it means that the growth of ETC will probably reverse, and you should pay attention to its other fundamental information at this time. We have made a correspondence between the future ETC price and the hash rate of ETC.
From the above calculation, even if ETC rises to 200U, it can only accommodate about 20.5% of ETH miners, and considering the current chip structure of ETC, it is very difficult for these 20.5% miners to artificially pull the ETC coin price to 200U (much higher than ATH).
Suggestion: Always pay attention to the migration of ETH miners, if there is a double drop in both price and hash power, it basically means that the power level of ETC has reached its peak.
4.Who is the future king of PoW between ETC and ETHW?
Technical level: Since ETC and ETH are originally the same chain, their mining principles and consensus are basically the same, and their source codes are also basically the same.
The mining difficulty level: the current mining difficulty of ETC and ETH has a big gap, ETC accounts for almost 3% of ETH’s Hash rate, which also leads to different mining rewards for miners on ETC and ETH. When the ETH merger is completed, the distribution of the original ETH miners in ETC and ETHW is unknown, and the current official support for miners to migrate to ETC instead of forking ETHW. And ETH is facing a “difficulty bomb” problem currently, in order to dismantle this bomb, ETHW also faces the risk of forking in the future.
Ecological level: The ecological construction of ETH is way much better than ETC, but it can be predicted that most of the ecology will migrate to ETHS after the merger of ETH is completed, so how much ecology can be left in ETHW is still an unknown.
Currency price: Currently ETC is worth 38U, and ETHW [IOU] is priced at 70U on average on various exchanges, so people are more convinced of ETHW from the currency price.
5.How to grasp the “dividend” of fork brought by the upgrade of Ethernet?
Method 1: Buying ETH in advance and waiting for the fork to sell ETHW on the POW chain after the fork.
Method 2: Exchange ETHW [IOU] and ETHS [IOU] with one’s ETH in advance to a centralized exchange and trade ETHW and ETHS in advance according to one’s valuation.
Method 3: Go to a centralized exchange to stake your own holdings of mainstream tokens such as USDC and BTC, and then exchange them for ETHW[IOU] to trade in advance.
For detailed method, you can refer to: