Ethereum miners saw an earnings boom in July

Ethereum miners outperform BTC miners

Ethereum's big surge over the past month, which saw the cryptocurrency surpass $1,700, also saw cryptocurrency miners' profits surge, surpassing Bitcoin mining profits for the third month in a row.

Earnings from the mining of ETH, which is the basis for the operation of the Ethereum blockchain network, were $571 million in July. Miners' gains are even more fundamental considering that Ethereum's hashrate, unlike Bitcoin's, has been declining for some time. It reached 176,000 GH/s in June, while at the end of July 2018 it hovered at an impressive 280,000 GH/s.

We also have to consider the fact that Ethereum jumped by more than 60 % in a few weeks after the declines at the beginning of the year brought the price below $1000.

All this before the introduction of a new update, The Merge, which will change the authentication system from Proof of Work to Proof of Stake. The update is also causing a rapid migration of miners to Ethereum Classic, which has had a week of double-digit gains.

This Ethereum fork will actually retain the PoW system and Buterin himself spoke positively about it at the Paris conference:

“It's a very welcoming community. If you like proof of work, you should use Ethereum Classic, it's an absolutely great chain”.

Transition to staking

Ethereum sales were still slightly lower than in June, while Bitcoin sales rose.

According to the developers, the release of The Merge update, scheduled for September 19, and the difficulty bomb will bring an end to mining and companies that carry out this very energy-intensive activity and will bring a transition to coin staking, which, according to some calculations, expects to yield more than 10 %.

Daniel Hwang, Head of Protocol at leading staking pool Stakefish, said:

"Moving from mining to staking requires business development, customer service, communication with core developers, customer teams, software, redundancy".

The largest ETH mining pool, EtherMine, has also been transitioning its business model to ETH staking in the past few weeks. The company has just launched a beta version EtherMine Staking, services that specialize precisely in running a staking pool.

The problem will then arise only with individual miners, who will no longer have revenues and will have to sell their machines and switch to staking or switch – more likely – to other cryptocurrencies. 

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