Ether Merger Is The Most Awaited Thing In The Cryptoverse
Ether has promised to do better. It has promised to go to the next level, outshining crypto rivals and even surpassing the godfather, bitcoin. But the clock is ticking.
The number two cryptocurrency should have been weeks away from a “merge,” a transformative June upgrade of its blockchain Ethereum to make it faster, cheaper and less power-hungry, retaining the prospect of a meaner and cleaner crypto future.
This year expectation supported Ether, even as inflation and monetary tightening gripped Bitcoin. But that merger — which will see ether mining transition away from an energy-intensive proof-of-work method to proof-of-stake — has been delayed to disappoint investors.
“The deadline to see this launch continues to extend,” said Brendan Playford, founder and CEO of decentralized financial data platform Masa Finance.
“It is certainly plausible that the highly anticipated upgrade to Ethereum’s proof-of-stake system could be delayed again, given that this transition is highly complex and it is still uncertain whether it will actually be able to reduce costs. and can deliver on its promise of increasing transaction speed.”
Ether fell 8 percent to $2,947 on April 11, from $3,215 to $2,947 on the same day that Tim Beiko, lead developer of Ethereum, said on Twitter that the June rollout was pushed back as testing continued. It is down 13% this month at $2,844.
“It won’t be June, but it will likely be months later,” Mr Biko wrote in his tweet. “There’s no fixed date yet, but we’re definitely in the final chapter.”
The timing of the merge – where Ethereum’s EH1 chain will merge with a new chain to form ETH 2 – remains unclear, although many crypto watchers expect it to happen sometime this year. Beiko did not respond to requests for comment via Twitter and LinkedIn.
Merge and Flipping
Ether’s market capitalization of $363 billion is less than half that of bitcoin, and the two together make up 60 percent of the crypto market.
Yet bitcoin is just an investment in decentralized finance applications without any real potential to be used for contracts. For this reason, many investors believe that market volatility is inevitable – called “flipping” in crypto circles – with a merge acting as a catalyst for Ethereum to become the dominant platform.
Noel Acheson, Head of Market Insights at Genesis Trading, said, “We are seeing funds move around Ethereum in preparation for the merge, even though we don’t know when it is going to happen.” Buying interest, she said, “suggests that more funds are appreciating that (Ethereum) may be undervalued at this level”.
Both bitcoin and ether are mined or produced using a proof-of-work (PoW) method, where thousands of miners, or network nodes, compete to solve complex mathematical puzzles.
It is a massive electricity-thirsty process that causes more pollution each year than a small country, fueling fears about crypto in a low-carbon world.
The alternative proof-of-stake (POS) method uses much less power, as millions of computers race to process the puzzle, allowing the nodes that stake the most coins to validate the transaction. Put it.
Ethereum has long been associated with issues of speed and processing costs. It only processes 30 transactions per second as a proof-of-work blockchain, but expects to process 100,000 transactions per second once it moves to PoS.
This will allow it to compete with other, smaller altcoins such as Solana and Cardano, which use PoS partially or completely for decentralized finance applications such as trading, investing, lending and even non-fungible tokens. .
Provided Ethereum gets its upgrade.
“Ethereum Maxis, those who believe in ‘flipping’, believe it will come very soon,” Acheson said in Genesis Trading. “But this is only a theory and remains to be seen.”
(This story has not been edited by NDTV staff and is auto-generated from a syndicated feed.)