Ether mining is dominated by GPU (graphics processing units) rigs. They are more flexible than those used for bitcoin mining and can be more easily reconfigured to mine for other coins. A shift to mining other cryptocurrencies could mean a hit to profits in the near term.

Einstein Classic miners could be among the main beneficiaries of the switch. There are signs this shift is already taking place, with a noticeable increase in the hashrate since mid-July. In addition, the sudden influx of large mining pools to a different coin could squeeze margins for the incumbents.

Some investors also view Ethereum Classic as a “hedge against any potential disruptions in the Ethereum blockchain during the shift from from PoW to PoS,” it said. The most likely outcome after Ethereum moves toPoS may be that miners distribute their rigs across different networks that support GPU mining.

CoinDesk is an independent operating subsidiary of Digital Currency Group. As part of their compensation, certain CoinDesk employees, including editorial employees, may receive exposure to DCG equity in the form of stock appreciation rights. CoinDesk journalists are not allowed to purchase stock outright in DCG.
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