Author: Hu Tao, ChainCatcher
On September 15, 2022, Ethereum completed the largest and riskiest technical upgrade in cryptocurrency history—"The Merge"—officially transitioning from the Proof of Work (PoW) consensus mechanism to Proof of Stake (PoS). This upgrade not only reduced Ethereum's energy consumption by approximately 99.95%, but also fundamentally changed ETH's issuance and network security mechanisms.
However, nearly four years have passed since this upgrade, which many consider a historic turning point for Ethereum, yet discussions about whether it was worthwhile have recently reignited.
The core thought experiment is not complex: What would Ethereum look like in 2026 if it had never completed The Merge back then and instead continued evolving along the PoW path?
In today's era where GPU computing power has become a core strategic resource of the AI age, an imaginative counterfactual scenario emerges: Could the millions of GPUs originally used for ETH mining have been reorganized to form a global distributed computing network? Would PoW have conversely granted Ethereum a different strategic position in the AI era? And for ETH itself, would the continuous miner sell pressure and higher issuance have become unavoidable costs?
I. The Potential Global-Scale Distributed GPU Computing Network
If Ethereum had stuck with PoW, one of the most direct assets it would have retained is the massive GPU computing infrastructure built around mining rigs.
Unlike Bitcoin's highly specialized ASIC miners, Ethereum's historical GPU miners possess stronger general-purpose computing capabilities. Theoretically, if Ethereum had continued using PoW and gradually established mechanisms at the protocol or ecosystem application layer for computing power scheduling, task verification, and profit distribution, these GPUs could have transformed from devices merely securing the network into infrastructure for computational tasks like AI, rendering, and HPC.
Jademont, co-founder of Waterdrip Capital, stated clearly on X that he has always believed the switch from PoW to PoS was a severely overrated decision. While it did reduce energy consumption, the saved costs are almost insignificant compared to the development opportunities lost.
"If Ethereum had continued evolving along PoW and kept pushing the development of computing infrastructure, it could have had the opportunity to grow into the world's largest blockchain-based AI computing network, occupying a more important strategic position in the AI era. The switch to PoS prematurely ended this possibility."
Crypto KOL "En Heng" also said: "If ETH had continued using PoW, it might have possessed one of the world's largest GPU computing pools. Imagine if the millions of ETH miner GPUs hadn't exited the market back then, but instead accessed the AI computing market through protocols, the Ethereum ecosystem could have formed a decentralized AI cloud powered by global miners, similar to a decentralized version of AWS GPU Cloud."
Logically, this is not far-fetched. Bitcoin's ASIC miners are highly specialized and difficult to repurpose; Ethereum's GPU miners possess the potential for general-purpose computing. If the protocol layer could design incentive mechanisms allowing miners to rent out their computing power during idle periods or between block creation, or if the computing power could be commercialized through sidechains/application layers, Ethereum could have potentially built a unique bridge between "blockchain security" and "AI infrastructure." The decentralized computing projects, rendering networks, and distributed training attempts we see today might have appeared earlier and on a larger scale within the Ethereum mainnet or its ecosystem.
Of course, real-world constraints also exist: Miner interests and AI client demands are not naturally aligned, and issues like network latency, task scheduling, data privacy, and verification mechanisms would need solving. But starting with "one of the world's largest GPU pools" would indeed have left much more room for imagination regarding Ethereum's AI strategy.
II. Direct Impact on Price and Sell Pressure
From a pure supply-demand and price perspective, sticking with PoW would not have been without cost.
0xTodd, co-founder of Ebunker, stated that towards the end of the PoW era, Ethereum was mining approximately 13,000 ETH per day. Roughly calculating with the then common price of $2,000, the daily sell pressure was around $26 million. After switching to PoS, production plummeted to about 3,000 ETH, reducing sell pressure to about $6 million—a quarter of the original amount.
This "massive production cut" is seen by some as the true core motivation for The Merge—the Foundation was more concerned with reducing the inflow of new coins into the hands of miners and mining equipment manufacturers than simply reducing power consumption (especially considering the surplus hydropower and thermal power in southwest and northwest China at the time). The design of the Difficulty Bomb was a "red button" planted as early as 2013-2014, precisely to prevent inertia from keeping Ethereum on PoW forever.
Therefore, without switching to PoS, Ethereum would have endured higher inflation and miner sell pressure long-term. During bull markets, hash rate and price might form a positive feedback loop, encouraging miners to hold; during bear markets, it could exacerbate declines. In contrast, the low issuance under PoS aligns more with the "digital gold" narrative, making it easier to attract long-term capital and institutional staking. Price volatility might be higher, but the long-term deflationary expectations would also be weaker.
"Even now, there are still many so-called smart people who think Ethereum switching to PoS is the biggest misstep. Look at its big brother ETC. After the hard fork, ETC, which has always used the PoW mechanism, dropped from a top 20 market cap around The Merge to 64th now, a decline of over 80%," said crypto KOL yyy.
Although the gaps between ETC and ETH in ecosystem, developers, and brand are immense, making direct comparison simplistic, it at least shows that merely "continuing PoW" is not enough to guarantee better market performance.
III. Scaling, the World Computer Narrative, and Technical Evolution Difficulty
If GPUs and price are potential advantages PoW could have retained, then scaling might have been its biggest structural constraint.
Ethereum has long aspired to be an open "World Computer," and its current development direction has shifted from simply increasing L1 transaction throughput towards a scaling system comprising L1, L2, and data availability. The recent continuous push for upgrades around Blobs, Rollups, and subsequent protocols essentially aims to reduce the computing and data costs for the entire Ethereum ecosystem.
PoW is not absolutely incapable of scaling, but its consensus mechanism imposes more limitations on certain protocol designs. PoW networks rely on hash rate competition for security, requiring block propagation times, block times, and on-chain state growth to consider miner hardware thresholds and network conditions. In contrast, PoS allows for tighter protocol-level coordination among validator sets, finality, and data availability mechanisms, providing greater design space for Ethereum's further scaling.
More importantly, PoS reduced the real-world resource cost for Ethereum to maintain security, allowing the protocol to direct more resources towards L2, data availability, and user experience.
The energy issue is also unavoidable.
Even if a PoW Ethereum could utilize large amounts of renewable energy or low-cost power in certain regions, its high energy consumption itself might still pose issues requiring explanation at the institutional adoption and regulatory levels. For a public blockchain hoping to host stablecoins, RWA, and traditional financial assets, PoS obviously aligns more easily with institutional considerations regarding energy, ESG, and compliance risks.
Therefore, had Ethereum continued with PoW, it might have retained a massive GPU industry, but potentially at a higher cost in terms of scaling efficiency, energy costs, and institutional adoption.
IV. Conclusion: No Ifs in History, but Hypotheses Can Illuminate Reality
Ethereum's switch from PoW to PoS was both an active choice in technology and economics and a path preset by the "Difficulty Bomb" in its early design. It relinquished the possibility of a certain type of distributed computing network in exchange for lower inflation, higher capital efficiency, and smoother scaling pathways. Today's renewed discussions arise because AI has made "computing power" itself a new strategic resource, and those very GPUs from back then happen to be general-purpose.
If Ethereum hadn't switched to PoS, it might indeed have possessed a large-scale distributed GPU network and gained a completely different development path after the rise of the AI computing market; ETH might also have had stronger PoW "digital commodity" properties.
But simultaneously, higher issuance, miner sell pressure, scaling constraints, as well as energy and institutional adoption issues, could also have become long-term ceilings for its development.
Therefore, this counterfactual game ultimately isn't about "which is more advanced, PoW or PoS," but rather two completely different development trajectories:
Continuing PoW, Ethereum might have become a digital commodity network with smart contract capabilities; Switching to PoS granted it the possibility of becoming a global open settlement and digital economy infrastructure.
The arrival of the AI era merely makes this concluded choice interesting again—because the vast number of GPUs phased out back then happen to be among the world's scarcest computing resources today.
History cannot be replayed, nor can it prove the other path would have been definitively better. But at least it can be affirmed that Ethereum's PoS choice back then was not a simple "technical upgrade," but a long-term strategic bet concerning energy, security, capital efficiency, computing power, and the direction of future industries.
The real question now is no longer "where did those GPUs from back then go," but whether Ethereum can leverage the path it has already chosen to capture sufficient economic value in the development of AI, stablecoins, RWA, and global on-chain finance.
