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2 July 2022
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Ethereum

Ethereum’s quest to launch its merge to transcend the Bitcoin

  • Ethereum announces a shift from Proof of Work to Proof of Stake.
  • With this new model, investors don’t have to solve complex grinding and electricity-consuming puzzles.
  • However, due to the delay in this merge, Ethereum fell from $3,125 to $2,947

A flux and variability have been seen in the Ethereum(ETH) algorithm from Proof of Work (POW)  and adopting a new pathway of Proof of Stake (POS). This epic and historic merge would outshine Bitcoin and marginalize all the rivalries. Hence, this melding will create a new EH2 chain. Reports tell that Ethereum will complete this merge after June. Meanwhile, trials and testimonies have been made by the developers of this catastrophic fusion in the history of Cryptocurrency. One such crucial test, ‘mainnet shadow fork,’ has been successful. However, no revelation of the final date has been made for this new phase.

Ethereum, which ranks second in Cryptocurrency, makes up 60% of the crypto market together with bitcoin. 

Why this Epic Merge? 

Most ETH’s work relies on the Proof of Work (POW) strategy. In Proof of Work, miners complete a perplexing puzzle to finalize their transactions. This process is time and energy-consuming. Ultimately, miners pit against each other to access the newly minted coin. Those who solve the complex problem first append the new block to their chain. This process is also time-consuming as its transaction speed is very low.

However, this comes at the expense of excessive electricity consumption that produces more contaminants in the environment than in Third World countries. It has been estimated that Ethereum’s electricity usage annually is equal to that of the Netherland. Due to this upsurge of competition, people are cutting off electricity supply to each other. This chaos is the most critical situation faced by the users of Ethereum. 

Due to this situation badly impacting the environment, Ethereum will upgrade to Proof of Stake. The users will validate not by solving complicated problems but by the number of coins they contribute. This shift will enhance its transaction speed to 100,000 transactions per second. ETH, which falls at No. 2 Cryptocurrency, is upgrading its blockchain to be faster and less power-consuming. This merger will act as an activator that will make Ethereum dominant in the market. 

Implications of the delay 

Investors are expecting to witness the merge this year. However, investors are frustrated by this delay as Brendan Playford verified the extension of this launch. This delay gives rise to certain apprehensions about whether this merger would be successful in the context of electricity consumption, cost, and transaction speed. 

Ether has a considerable setback owing to this extension. On 11 April, Tim Beiko announced on Twitter related to the extension of this merge. On the same day, Ethereum fell from $3,125 to $2,947. This month a fall of 13% has been noted. Contrary, many investors have high hopes for the melding of Ethereum. 

This improvisation will allow ETH to compete with those small altcoins that use the Proof of Stake platform to facilitate users. 

Conclusion

Ethereum is back with a big bang in the space of Cryptocurrency. This merge from the Ether ET1 chain to the ET2 chain will allow the users to shift to Proof of Stake (POS). In this up-gradation, there is a higher probability that users’ transactions will get more validation, and in return, they will earn more coins. No, a confirmed date has been announced yet for this launch. However, both the developers and consumers have speculations that it will happen soon. There is skepticism about it as Ethereum has promised this option of Proof of Stake for five years. However, funding is rotating within Ethereum, and people are preparing for this skeptical Ethereum merge.

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