Following Ethereum Merge, GPU Prices In China Have Recorded A Major Dip

It has been less than 15 days since the Merge was implemented on the Ethereum blockchain. The upgrade reportedly moved the Ethereum blockchain consensus from proof-of-work (PoW) to proof-of-stake (PoS).

Mining Rigs Rendered Useless

As the consensus protocol changed entirely, the mining for Ethereum (ETH) has become rather useless. In the past, the prices of the cryptocurrency mining rigs including the GPUs used for providing the computational power were in high demand.

Prior to the implementation, Ethereum was based on the proof-of-work consensus. This meant that the adoption driving mechanism for ETH was mining it, increasing its computational power, and increasing its market demand.

Now, the consensus is PoS, which means that institutional investors are responsible for investing heavily in ETH to increase its demand.

China is Feeling the Impact

Now that the protocol has moved to PoS, mining is no longer traction, and the graphics processing units (GPUs) are considered out of fashion.

Among all the countries witnessing a low demand for GPUs and mining rigs is China which has recorded the highest impact. The demand for the GPUs and mining rigs has fallen tremendously in China.

GPUs See Huge Dips in Value

As the Merge implementation kept coming closer, the most liked and demanded GPUs used for mining ETH continued losing their demand in the market.

Among these GPUs are the ones launched by Nvidia GeForce. The values of their graphics cards have dipped tremendously, were the most demanded GPU “RTX 3080” has recorded a huge drop.

According to a report published by South China Morning Post, the value of RTX 3080 has recorded a huge drop. During its high demand, the value of the RTX 3080 was at a high of $1118, translating to 8,000 Chinese yuan.

As the Ethereum Merge came closer and was finally implemented, RTX 3080’s value dropped to 5,000 Chinese yuan. The value of the GPU has reportedly dropped in the past three months.

Comments by GPU Merchants in China

The report also covers statements made by GPU merchants. According to them, the mining companies and firms were on buying sprees when the demand for Bitcoin and Ethereum mining was too high in the country.

However, with the banning of Bitcoin mining and transitioning of ETH PoW to PoS, GPUs used for mining have lost their value tremendously. There is no one coming in to buy these GPUs and there is no demand at all.

With the demand for ETH mining dropping to almost zero, Ethereum Classic (ETC) has finally started gaining momentum. If the momentum continues to grow, these GPUs would be in demand once again, as several mining firms would move to mine ETC.

This would eventually increase ETC’s demand in the market, making it more attractive for investors to trade.