ETH in volatile trade after most-awaited Merge. How will the new upgrade help

Market


On CoinMarketCap, at the time of writing, Ethereum was trading at $1,590.39 down by 0.87%. Its current market cap is around $194.63 billion. However, the volume traded in Ethereum scaled up to nearly 22% in the 24 hours. Overall, the trading in Ethereum is volatile.

Due to the current price level, Ethereum’s weekly performance is down by nearly 2%.

Ethereum Merge

The Merge was successfully executed on September 15. It has completed Ethereum’s transition to proof-of-stake consensus, officially deprecating proof-of-work and reducing energy consumption by ~99.95%.

As per the Ethereum website, the Merge was the joining of the original execution layer of Ethereum (the Mainnet that has existed since genesis) with its new proof-of-stake consensus layer, the Beacon Chain. It eliminated the need for energy-intensive mining and instead enabled the network to be secured using staked ETH. It was a truly exciting step in realizing the Ethereum vision—more scalability, security, and sustainability.

How does Merge help Ethereum, blockchain market

According to Parth Chadha, Co-Founder, and CEO, STAN, Ethereum, the world’s second-largest blockchain, successfully transitioning to the proof-of-stake model, marks a momentous milestone for the blockchain and web3 community worldwide and in India as well. The Merge will help not just in making the entire blockchain network more energy-efficient, but also enable greater levels of safety, security, and scalability for and within the network.

Further, STAN CEO added that it is also expected to increase the uptake of DeFi transactions and NFT creation and sales, which comes as an exciting news for the blockchain-oriented gaming and esports community. It may also help in lowering the gas fees of Ethereum – which in turn could help accelerate greater adoption of web3 games and game developers into the network.

Amanjot Malhotra, Country Head – India, Bitay explained that the smooth transition of ETH Pow to PoS without any glitch is a testament to a solid tech team of Ethereum. He added, the chain will now become more decentralized as compared to before because it is easier to become a validator which will make the chain more secure than before. It also becomes ESG compliant which could attract institutional capital to ETH.

In WazirX Vice President, Rajagopal Menon’s view, it is no minor feat to switch from PoW to PoS without any downtime given that it may have been one of the largest open-source software endeavours in history, requiring coordination across multiple teams, individual researchers, developers, and volunteers.”

Further, Menon added, “after the Merge, the power consumption to secure Ethereum has been cut down by around 99.95%. This in turn brings down a lot of arguments about Ethereum, DeFi, and NFTs “killing the planet”. As a byproduct, it also makes Ethereum ESG compliant which can be good for more regulatory-driven institutions that may want to start exploring the Ethereum ecosystem. This will also make Ethereum more friendly to gamers and NFT artists concerned about the environmental impact of crypto.”

But Merge transition may be time-consuming..

Om Malviya, President, Tezos India on Ethereum’s ‘The Merge’ said, “ ‘Forking’ is inevitable when it comes to the real use case of The Merge. One can term this event as a trick to create hype around Ethereum. But the long-term implications will only become more clear and evident once the transition takes place.”

The world’s largest cryptocurrency exchange, Binance on Thursday notified that if the potential Ethereum Proof-of-Work chain (ETHW) is successfully implemented, eligible users will be credited ETHW at a ratio of 1 ETH = 1 ETHW in their Spot wallets, based on their net ETH balances across eligible wallets at the snapshot time of 6.42 (UTC) on September 15. This process will usually take about two to five days.

“This merge does not directly address the ongoing issues of scalability or high gas fees but it paves the way to address them in future updates. One of the key benefits of the merge is the dramatically reduced ETH issuance which has been dubbed the “triple-having” of ETH,” Menon said.

ETH fanatics looking forward to more upgrade..

Menon said, “With the Merge already done and dusted the ETH fanatics are already looking forward to “the Surge, the Verge, the Purge, and the Splurge.”

On the price level, Bitay’s Country Head said, there was no significant price movement observed during the merge and it will be interesting to see the price movement in the coming months.

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