Can you mine ethereum with bitcoin miner

Valid Points: Forget Staking, There Are Still Coins to Be Mined on PoW Ethereum

‘Twas the penultimate night before Christmas, when all through the network, every machine was stirring, down to even the smallest Raspberry Pi. 

While businesses, the stock markets and many restaurants will be closed for the holidays, Ethereum 2.0, like all other blockchain networks, will be humming along the same as any other day of year without interruption. 

This has implications for validators, the main participants of Eth 2.0, who are responsible for keeping the network secure all year round, 24/7.

Luckily, most of the programming to keep the Eth 2.0 network online and active falls to validators who, in large part, simply have to ensure their internet connection is stable and their machines are connected to a steady source of electrical power. 

The incentive for validators to do this work and ensure their operations are running smoothly,  even through the holidays, is an average daily income of 0.0089 ETH, which is equivalent to $5.57 at time of writing. 

Running an Eth 2.0 validator node may not be a full-time job, but it is a responsibility that requires participation 365 days of the year (or 366 if it’s a leap year) in order to maximize income. 

Judging by the 15,600 or so validators who are queued up for entry into the network over the coming days, and the 99% participation rate of validators who are already admitted into Eth 2.0, it would seem for many the rewards do outweigh the responsibility. 

New frontiers for Ethereum mining

A long-awaited highly efficient and powerful Ethereum mining machine first promised in 2018 is making its market debut three weeks after the launch of Eth 2.0’s Beacon Chain – the proof-of-stake (PoS) blockchain meant to replace mining entirely.

Shenzhen, China’s Linzhi Inc. has begun to roll out a new Ethereum ASIC miner reportedly  three times more powerful than the nearest categorical competitor, the A10+ Pro. The new machine was demoed by mining pool F2Pool in a YouTube video Saturday. 

Although it may seem odd at first glance, it’s a good reminder that Eth 1.x is still around and isn’t going away anytime in the near future. Indeed, Ethereum continues to settle similar or even more value than its crypto cousin Bitcoin, according to Money Movers.

Chen Min founded Linzhi in 2018, following her departure as CTO from Canaan Creative, another prominent mining rig manufacturer. As reported by CoinDesk at the time, Min wanted to create a more powerful ASIC Ethereum miner, all the while knowing the network would eventually transition to proof-of-stake (PoS), making her firm’s Ethereum specific work obsolete.

Still, miners have at least a two-year runway with Proof-of-Work (PoW) on Ethereum. The current network, Eth 1.x, won’t be moved over to the new PoS blockchain until phase 1.5 of Eth 2.0.

“New investment decisions to build out more mining hash power for Ethereum do now have an additional time-risk factor as the reward stream now appears finite,” ConsenSys Head of R&D Robert Drost told CoinDesk in an email. “On the other hand, Eth has been trending upwards nicely, so as you say there can be money to make in battling for as many coins as possible beforehand!”

The product’s initial tests seem to be living up to expectation. According to F2Pool, the Phoenix outpaces the A10+ Pro at a near three-to-one clip in megahashes per second (2,600 MH/s to around 500 MH/s) while also being more energy efficient (3,000 watts per hour to the A10+ Pro’s 1,300 W).

Mining pools such as SparkPool and Etherchain will continue to fight out who gets the last coins issued on the proof-of-work Eth 1.x blockchain. If Eth 1.x continues chugging along for another two years, back-of-the-envelope calculations value those coins at some $3 billion dollars under current prices. 

There are also transaction fees up for grabs if Ethereum’s next hot thing sticks around: decentralized finance (DeFi). This past August and September, fees on Ethereum reached all-time highs not once but twice, as DeFi applications spit out high returns on investments in what is called liquidity mining or yield farming. As reported by CoinDesk, miners enjoyed daily profits last seen during the tail end of the 2017-2018 bull market. 

Lastly, Eth 2.0 may need specialized hardware orthogonal to what Linzhi and other mining firms manufacture, with the ability to support zero-knowledge proof (ZKP) computations, for example. Other blockchains such as Ethereum Classic use the same hashing algorithm as Ethereum, too, and will continue to be mined after Ethereum’s transition.

“There is significant research into on-chain computing workloads, zero-knowledge and so on,”  Linzhi’s director of operations, Wolfgang Spraul, told CoinDesk in a Telegram message. “Our technology is relevant in that area as well, that’s the ETH 2.0 stuff. We do not only invest in the PoW use case, we can add programmability and then target other workloads.” 

So, while many eyes are on staking, sharding and every other Eth 2.0 buzzword, Ethereum miners continue to see an upside to Eth 1.x investments.

• What crypto looks like when viewed from outside the bubble (Podcast, Bankless)
• The three types of slashable events on Ethereum 2.0  (Blog post, Blox Staking)
• DeFi startup brings corporate lending terms to miners, traders and market makers (Article, CoinDesk)
• More than $1 billion of ETH staked on Ethereum 2.0 (Article, CoinDesk)
• Uniswap is the number one gas guzzler on Ethereum (Article, CoinDesk)
• Compound chain foreshadows cross-chain DeFi lending (Article, The Defiant)
• Gemini to support Ethereum 2.0 trading and staking (Blog post, Gemini)
• The state of Ethereum Improvement Proposal 1559 (HackMD post, Tim Beiko)