As the Ethereum network’s move toward a proof-of-stake (PoS) consensus mechanism drives adoption by institutional investors, prices for graphics processing units (GPUs), which are often used for mining of cryptocurrencies such as Ether (ETH), have gone down in China.
Following the historic Ethereum merger on September 15, previously highly sought-after Nvidia GeForce GPUs have become significantly cheaper according to a report from the South China Morning Post. Peng, a Chinese trader, gave the RTX 3080 as an example, as the price of the GPU dropped from 8000 yuan (1118 USD) to 5000 yuan in 3 months.
According to Peng, when Bitcoin (BTC) mining was at its peak in China, mining companies were making purchases of GPUs. But for now, the retailer said no one is buying new PCs, let alone new GPUs.
Another trader named Liu also noted that low-end RTX 3080 cards from manufacturers such as MSI also dropped about 2,000 yuan compared to prices 2 months ago. According to Liu, this may be heavily influenced by the hype surrounding the Ethereum merger.
Retailers are not the only ones affected by lower demand. Online shopping platforms Taobao and JD have also shown a decrease in GPU prices. The RTX 3080 cards on these websites have slowly dropped in price by a few hundred yuan compared to their prices three months ago.
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After the Ethereum merger, the ETH blockchain moved from its energy-intensive proof-of-work (PoW) mechanism to the PoS layer called the Beacon Chain. With this, the miners who used to process transactions and produce blocks are replaced by ecosystem participants who would stake ETH to become the new validators of the network.
Meanwhile, a PoW fork called ETHPoW was launched when the merger started. However, despite its attempts to maintain the PoW consensus, it suffered technical problems when it launched, reducing the price of its ETHW token by 65%.