The problem lies in the question.
Ethereum was never intended as a replacement to Bitcoin (as opposed to altcoins) nor like a currency ([1]), it was designed as a smart contracts platform.
Yet some people are using Ethereum as a replacement for Bitcoin or ALTERNATIVE Bitcoin ([2]), something that it was never intended to.
Now, people are spending their bucks for mining Ether extensively ([3]), yet the small altcoins that deserve mention are getting into oblivion by 51% attacks.
As of date, Ethereum is using (IMO, wasting) 2.8TH/s, which is too high for a hashing algorithm like Ethash.
People should support cryptocurrencies which have really something to do rather than putting all their GPUs and CPUs and everything else in mining Ether, that will make more decentralization than centralizing all in Ether...
[1]: Wikipedia
[2]: NYTimes article
[3]: Ethereum network hashrate
Basically he wanted this to be another type of Bitcoin 2.0 venture where it wasnt based on top of bitcoin.
Anyways, what we talk about is ROI. For people to invest in smart contracts they buy ether which brings the ether price up. And also, the coin had a great ROI, even now just look at $ invested and return rate is best in ethereum. They initially, I believe most people till February did it because they believed in the coin and were interested with the concept.
Miners then saw the profit and transferred there..
Its only a waste if the miners are not getting profit, and they are. They need a market where they can mine to supply the demand, which there is as people are investing in the early stages for early ETH projects like DAO and also people are investing before the next stage of the launch
I'll not repeat this again.
I am talking that is a waste of time in most miners perspective if it is not going to get an ROI... Whats wrong in that? Most are farms in bitcoins that earn money, and if dont they liquidate. But they invest because they see the potential for profit. Correct me if I am wrong...