Ethereum’s Merge goes live. How it could impact Web3 enterprises?

Market


The network has officially switched over to proof-of-stake as a result of the Ethereum Merge (PoS). The Beacon Chain’s consensus layer and the Ethereum Mainnet execution layer were merged on September 15 at 06:42:42 UTC at block 15537393, resulting in the long-awaited Merge. As a result, the network will no longer rely on a proof-of-work consensus method.

The Merge, according to the Ethereum Foundation, would increase the Ethereum network’s energy efficiency by around 99.95% and pave the way for the next scaling options like sharding.

Speaking to LiveMint, Chris Kline, CRO, and co-founder of Bitcoin IRA says staking solutions are designed to encourage more users to join the network and in times of extreme usage, ETH speed and gas prices created network congestion and a poor experience for some.

“This upgrade will lower the barriers of entry for users, making the consensus-driven allure of this new technology more accessible. By driving more staking nodes, more consensus emerges and developers are able to efficiently operate in the network. Consensus helps create decentralization and gives everyone a voice in the management of the network, creating an easier on-ramp for those looking to contribute,” Kline says.

While The Merge may not affect most enterprise use cases that are presently in use, it will materially change how businesses view Ethereum.

The switch to proof-of-stake makes Ethereum more secure and paves the way for potentially significant future improvements in addition to actual energy savings.

Big network capacity improvements and structural modifications that will let far more devices participate are at the top of the agenda.

“The shift to proof of stake will also signal a new era in the competition among blockchain ecosystems. The merge will solidify Ethereum’s dominance and shift the basis of competition to the Layer 2 networks that exist to help scale up Ethereum. Layer 2 networks will be needed to handle a new wave of privacy applications and high-volume transactions in supply chain and finance,” according to Paul Brody, EY Global Blockchain Leader.

Experts say that it is important not to evaluate the Ethereum Merge as a singular event, but rather as a chapter in Ethereum’s larger, ongoing evolution.

This moment in time is monumental for Web3––the transition to proof-of-stake (PoS) mitigates climate concerns, hopefully driving more layer-1s to follow suit, while reducing this common barrier to entry for mainstream adoption of Web3, which alone is worth celebrating.

“I know, in recent conversations with Vitalik and others at the Ethereum Foundation, that these Web3 milestones, such as light clients, single-slot finality, and usability, are being taken seriously in Ethereum’s evolution following the Merge (or ETH2)––it is our continued responsibility as builders to make transacting on blockchains easier for real-world users of all experience levels,” Marek Olszewski, Celo Co-Founder, Valora President, and cLabs Partner says.

Experts further said the Ethereum merger could be the opportunity of a lifetime with the possibility of the inflation rate of ETH supply being decreased by 90%.

This massive decrease in the ongoing issuance of ETH supply is why this event has been dubbed the “triple-having”.

“With the promise of a decrease in issuance and the continued burn of ETH supply, it has the potential to make ETH the Ultrasound money of tomorrow’s future,” Walker Holmes, vice president of MetaTope says.

“With great opportunity comes great risk and even more speculation. The consensus of the market is weighted in favor of the Eth merger being successful, however, large-scale issues with the transition to proof of stake could be catastrophic for the short-term outlook for ETH price,” he adds.

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