The world’s second-largest Ethereum mining pool, SparkPool, has announced that it will be suspending operations in the wake of China’s continued crypto crackdown.
The latest victim of Beijing’s unrelenting intolerance of digital assets is the Ethereum mining pool, SparkPool, which is the second largest after Ethermine.
In a notice tweeted on Sept 27, the mining pool stated that it will completely shut down all services and operations for existing users in China and overseas on Sept 30, 2021.
It halted services to users in mainland China on Sept 24 to remain “maximally compliant with regulatory requirements.”
Ethereum miner exodus
SparkPool currently has a 19% share of the hash rate of all Ethereum mining pools, which account for around two-thirds of the total. According to PoolWatch, SparkPool produces 131.2 TH/s (terrahashes per second) from 61,544 miners. The leading Ethereum mining pool, Ethermine, has a 23% share with 159 TH/s and 306,619 miners.
SparkPool was launched in 2018 by a Chinese tech community called Ethfans. It’s unlikely that the pool closure will have much of an impact on Ethereum hash rates which are currently around their highest ever levels.
According to BitInfoCharts, the total Ethereum hash rate is currently 719 TH/s, down marginally from its all-time high of 736 TH/s on Sept 25. In terms of growth, the Ethereum hash rate is up 145% since the beginning of the year and looks extremely healthy despite China’s efforts to crush it (and everything else crypto-related).
Bitcoin’s hash rate has almost fully recovered since the Chinese blockade earlier this year which caused a 50% slump to 68 EH/s (exahashes per second) in late June as rigs were powered down. The average daily hash rate metric is currently at 140 EH/s which is around 40% down from its peak of 197 EH/s in mid-May.
Proof of Stake transition
Ethereum will be transitioning away from mining and proof-of-work at some stage in the first half of 2022. The “merge” will dock the ETH 1 blockchain with the ETH 2 proof-of-stake chain and mining operations will become redundant in favor of proof-of-stake.
There is currently 7.7 million ETH staked on the Beacon Chain according to the explorer. This is currently worth approximately $23 billion at current Ethereum prices. The funds are locked at the moment and will not be accessible until after the merge.