Looking to invest in Proof of Work Ethereum (ETHW)? You can buy ETHW on Crypto.com
Following the Ethereum Merge to proof of stake (PoS), the Ethereum network was hard forked into multiple, separate chains that still operate with the proof-of-work (PoW) consensus. The notable two are EthereumPoW and EthereumFair. The networks look to become options for Ethereum miners who were potentially out of a job post-Merge.
Overview of PoW Ethereum
Until recently, Ethereum was a PoW network where miners used their computation power to validate the network. The big issue with this system is the massive amount of energy it used. It is one of the major talking points for those who are anti-crypto and for crypto enthusiasts who are concerned about climate change.
The Merge gives Ethereum an advantage over Bitcoin, which operates through a PoW consensus method. Bitcoin mining is more power-hungry than some entire countries. As potential crypto regulations loom, avoiding laws based on energy usage is helpful for Ethereum. While Bitcoin maximalists believe in their unchangeable form of money, the Ethereum proponents seem to be growing in numbers.
Ethereum has more use cases than Bitcoin. As the Ethereum ecosystem flourishes, some believe it could overtake Bitcoin in market capitalization and have even termed this event “The Flippening.” The Merge could be a big step in that direction as it draws in more developers, becomes more energy efficient and paves the way for sharding.
While PoS reduces energy usage, many still critique it, contending that it is not as decentralized as PoW. Additionally, the loss of revenue for crypto mining companies and individuals means that Ethereum PoW forks have emerged, offering a new network for miners to participate in.
Why Do People Use PoW Ethereum?
The key reason people are using the PoW networks on Ethereum is to try to make a quick buck. Most Ethereum miners will probably transfer operations to Bitcoin, Ethereum Classic or other PoW blockchains that have proven relevant over a longer period of time.
PoW Ethereum History
Ethereum was founded with a PoW consensus. While the network had planned to merge to a fully PoS consensus for a long time, it only became a reality on Sept. 15, 2022. Ethereum hard forks, notably Ethereum Classic, EthereumPoW and EthereumFair, will keep using a PoW consensus mechanism.
The oldest of the three PoW Ethereum networks is Ethereum Classic. The Ethereum Classic network is actually the original Ethereum network from which Ethereum was hard forked. The reason for the hard fork was that the network was funded by The DAO, which was operating on the chain. The DAO was hacked and slowly drained of its money; however, hard forking the network helped return the funds to owners and fixed the bug in the network. This fork lost community interest over time, possibly providing insight into the future of ETHW.
Where to Buy PoW Ethereum
Few large trading platforms support ETHW. However, Crypto.com has ETHW available for trading. Far more popular is Ethereum Classic, which is not in the same category of the new Ethereum forks from The Merge but is a PoS network. Despite its lack of utility, Ethereum Classic still has a viable community, and its market cap is trending around $1 billion.
If you are looking for exposure to the latest coins, it is best to have a non-custodial wallet like MetaMask. With it, you can explore decentralized exchanges and trade coins before they become available on centralized finance (CeFi) trading platforms.
PoW Ethereum Blockchain vs. Other Blockchains
The top blockchain in the world, Bitcoin, operates on a PoW network. Despite this, the developing sentiment from many in the sector confirms the superiority of PoS, which more blockchains are opting for. While the PoW Ethereum networks are using the same consensus mechanism as Bitcoin, it is starting to become dated. There is a chance that Bitcoin is the only PoW network that maintains relevance in the long term.
How to Store PoW Ethereum Safely
The best way to store PoW Ethereum or any cryptocurrency is through a hardware wallet. While software wallets help connect you to a decentralized exchange and other decentralized applications (dApps), hardware wallets help to store your funds offline and out of harm's way. The most popular hardware wallet is Ledger. The flagship product, Ledger Nano S, has become the industry standard for cold storage wallets.
Will PoW Ethereum Stay Relevant?
As crypto continues to mature, PoW Ethereum is unlikely to stay relevant. Most experts believe that PoS is a superior consensus method. PoW Ethereum is likely not worth the time.
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