Ethereum finalizes The Merge: a new era for crypto?
Cryptocurrency Ether finally abandons proof-of-stake-mining, eliminating emissions from its blockchain system.
After several years of development and many delays, Ethereum’s Merge update was finally launched Thursday.
Vitalik Buterin, co-founder of the second most valuable crypto currency, announced this on Twitter. “And we are ready! Happy Merge everyone.
This is a big moment for the Ethereum ecosystem,” it reads.
99.9 percent less power
Through the Merge, Ethereum’s system is switching from the energy-intensive proof of work system, which Bitcoin also uses, to proof of stake.
Through this type of crypto-mining, Ether tokens are used to validate transactions and mine blocks.
Thus, entire silos with walls full of computers will no longer be required to keep the system running.
As a result, Ethereum would consume 99.9 percent less power than before the Merge.
“The Merge will reduce global electricity consumption by 0.2 percent,” also casts Ethereum analyst Justin Drake.
Furthermore, the update would also make the system with a market value of just under $200 billion more secure and scalable. Hundreds of crypto applications and NFT platforms exist on Ethereum’s ecosystem.
How will investors react?
The new version of Ethereum’s system is likely to be backed by the largest crypto companies.
Crypto exchange Binance, the world’s largest trading platform for digital assets, already announced Thursday morning that trading Ether tokens was being reactivated on its platform.
For now, not much enthusiasm can be seen in the crypto market.
Shortly after the finalization of the Merge, the price of Ethereum’s crypto coin briefly dropped by almost a full percentage point. Ether is currently posting a 24-hour price increase of about 1 percent.
At the time of writing, an Ether coin is worth about $1,624. So the big price explosion predicted by many Ethereum enthusiasts remains to be seen for now.
What about the miners who continue to hold proof of stake?
Several miners who have pumped thousands of dollars into equipment to mine Ethereum via proof of work announced that they will continue their operations.
As a result, they will effectively create a fork (split) of the Ethereum system and continue to release their own version of Ether.
It is unclear how many miners will attempt this and how successful it will prove to be.
Buterin informed all that Ethereum’s hashrate,
or total computing power pumped into the system, is only a few percent lower after the Merge than before.
This means that through the brand-new proof-of-work system, enough coins will be deployed to keep Ethereum running.