A significant shift occurred in the Ethereum network on September 15, 2022, when it transitioned to a proof-of-stake (PoS) system. This change eliminated the need for power-hungry, graphics processing unit (GPU)-based proof-of-work (PoW) mining, a system that had been in place since Ethereum’s launch on July 30, 2015.
While Bitcoin remains the dominant force in the PoW landscape, the departure of Ethereum’s GPU mining farms has led to their dispersal across a variety of smaller blockchains and combined computing environments. This analysis explores where these resources have gone, focusing on the top PoW networks in 2025, the economics of mining, emerging hotspots, and the reasons why security driven by cost remains a key strength of PoW.
Impact of the Ethereum Merge
Understanding Proof-of-Work and Proof-of-Stake
Proof-of-Work requires miners to solve intricate cryptographic puzzles through intensive computational hashing. This process is crucial for securing blockchains like Bitcoin, making it expensive and difficult to tamper with new blocks. Conversely, Proof-of-Stake replaces this computational effort with financial stake. Validators put up their cryptocurrency as collateral and are randomly selected to create new blocks, a method that drastically reduces energy consumption.
The Great GPU Migration
The Ethereum PoW network reached its peak hashing power, around 1.24 PH/s (petahashes per second), in mid-June of 2022. The Merge on September 15 resulted in over 1.2 PH/s of GPU mining capacity being deactivated.
In the weeks following the Ethereum Merge, GPU hashing power predominantly moved to four leading Proof-of-Work networks:
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Ethereum Classic: Increased from 26 TH/s to 236 TH/s, marking an 808% surge.
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Ravencoin: Expanded from 2.76 TH/s to 16.88 TH/s, representing a 511% rise.
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Ergo: Grew significantly from 14.46 TH/s to 99.59 TH/s, a 589% increase.
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Flux: Saw substantial growth, moving from 1.34 MH/s to 9 MS/s, a 571% increase.
The GPUs that were displaced from Ethereum could not transition to Bitcoin because Bitcoin’s SHA-256 PoW relies on specialized ASIC hardware. This made GPU mining unprofitable on the Bitcoin network. Instead, miners turned to four GPU-friendly algorithms:
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Ethash (Ethereum Classic): A memory-intensive mining algorithm designed to prevent the dominance of specialized ASICs and keep GPU mining profitable.
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KAWPOW (Ravencoin): An algorithm that regularly adjusts its calculations to ensure GPUs remain competitive and to resist the development of specialized mining equipment.
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Autolykos v2 (Ergo): Designed for straightforward GPU operations, making mining accessible without needing specialized hardware.
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ZelHash (Flux): Specifically tailored for GPU mining, optimizing for both energy efficiency and profitability.
PoW Networks Thriving Today
Kaspa (KAS)
Kaspa aims to be a digital currency alternative to Bitcoin, positioning itself as “digital silver” compared to Bitcoin’s “digital gold”. The name “Kaspa” comes from an ancient Aramaic term for silver or money, highlighting this complementary relationship.
Technically, Kaspa is built on the GHOSTDAG protocol, which allows for rapid transaction speeds. It currently achieves one block per second and has ambitions to scale further, potentially reaching 10 or even 100 blocks per second.
Monero (XMR)
Launched in 2014, Monero prioritizes user privacy and fungibility, ensuring transaction anonymity using ring signatures and stealth addresses. Monero uses RandomX , a PoW algorithm developed by Monero contributors and integrated since release 0.15. Ultimately, Monero facilitates fast, affordable transactions that are resistant to interference or censorship.
Ravencoin (RVN)
Ravencoin was released on January 3, 2018, as an open-source fork of Bitcoin, specifically designed for peer-to-peer asset transfers. It features a 21 billion coin supply, one-minute block times, and a block reward starting at 5,000 RVN per block. The KAWPOW mining algorithm leverages GPU memory and computational power to prevent ASIC dominance.
Ergo (ERG)
Ergo, launched in July 2019, utilizes the Autolykos algorithm, which is optimized for GPU mining. In addition, Ergo supports advanced smart contracts and privacy tools, making it a flexible platform for decentralized applications.
Flux (FLUX)
Flux is a mineable PoW cryptocurrency powering a decentralized cloud infrastructure intended for Web3 applications. It supports various uses, including payments for resources, staking in FluxNodes, and transactions within the FluxOS ecosystem. With over 13,500 nodes and extensive computing resources, Flux operates one of the largest decentralized networks worldwide.
Current Economics of Mining
Mining profitability depends on several factors, including the price of the cryptocurrency, network difficulty, and electricity costs. While ASIC-based Bitcoin mining can be profitable at an industrial scale due to its energy efficiency and access to lower energy rates, GPU mining is more vulnerable to fluctuations in cryptocurrency prices and energy costs.
Following Ethereum’s shift away from PoW, the demand for GPUs declined significantly, leading to a wave of hardware decommissioning and industry consolidation. Today, most miners participate in mining pools to mitigate income variability, as solo mining on smaller PoW chains is riskier and often results in delayed or inconsistent returns.
Geographical Changes & Regulatory Environment
As Bitcoin’s hashrate continues to grow, global mining operations have strategically relocated to regions offering favorable energy conditions and clear regulatory frameworks. Paraguay, for instance, has become a South American mining hub, benefiting from low hydroelectric rates from the Itaipu Dam and hosting approximately 1.45% of the global hashrate by mid-2025.
Similarly, Kazakhstan experienced an influx of miners following China’s 2021 ban, attracted by deregulated energy markets and readily available warehouse space. In Africa, countries such as Ethiopia, Kenya, and Nigeria are utilizing local renewable resources like hydropower, mini-grids, and solar power to support mining operations and community infrastructure, indicating a trend toward decentralizing hashpower in emerging economies.
Altcoin Miners: Navigating Energy Politics and Global Regulations
Beyond Bitcoin, GPU-based altcoin miners are also adjusting to energy politics and regulatory demands. As regulatory scrutiny increases in the U.S. and Europe, many operations are moving to regions with less oversight or abundant energy resources.
GPU-based miners are adapting to regional energy landscapes, with some exploring solar partnerships or utilizing low-cost rural energy sources to remain profitable. In Paraguay, GPU farms are collaborating with solar grid operators, while in the Middle East, miners are using flared gas for energy. These adjustments demonstrate a wider trend of merging policy, energy economics, and decentralized infrastructure.
Dual-Use Computing Strategies
As mining profits decrease, operators are finding dual-use applications for their infrastructure. Hive Digital Technologies, for example, uses its GPU arrays for machine learning tasks when crypto markets are down. These GPUs switch back to PoW mining when cryptocurrency prices rise, offering a flexible model that combines blockchain validation with AI computing contracts. This enhances capital efficiency and reduces dependence on the volatile income from mining.
Similarly, TerraVerde Energy is integrating Bitcoin mining with solar energy using real-time optimization software. This model dynamically shifts surplus solar power between the grid, battery storage, and mining hardware, ensuring profitability by minimizing energy waste.
The Lasting Value of PoW’s Security
Despite environmental concerns, PoW remains the most thoroughly tested mechanism for decentralized consensus. PoW continues to set the standard for trustless validation due to:
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Verifiable Operation: PoW requires real, verifiable computation, making fraud and manipulation virtually impossible.
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Inherent Resistance to Censorship: Disrupting block production requires significant energy and capital, rendering censorship economically impractical under PoW.
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Open Access: Anyone with standard hardware can participate in mining, decreasing the risk of centralization and restricted access.
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Proven Adaptability and Security: Bitcoin’s hashrate, exceeding 0.8 Billion TH/s, demonstrates PoW’s robust security and global miner involvement.
Final Thoughts
PoW remains the most proven and censorship-resistant method for achieving consensus in the world of crypto. Driven by necessity and cost reduction, alternative miners are innovating in solar-powered rigs and AI-integrated clusters.
The Ethereum Merge forced GPU miners to adapt, creating new dynamics across niche PoW networks and innovative computing strategies. While Bitcoin’s ASIC mining dominates in scale and security, smaller chains like Kaspa, Monero, and Ravencoin have become hubs for experimentation and community-driven resilience. Alternative mining doesn’t compete with Bitcoin but adapts and focuses on flexibility and local utility.