The whole crypto space can finally fasten their seat belts as the release date of the most awaited and the interesting crypto event will be released. Yes, Ethereum Merge is finally happening! The Ethereum organization has revealed the date of the launch of Ethereum 2.0 or the Merge, i.e., September 6, 2022.
To make the Ethereum Merge public, the launch will happen in 2 stages – the first stage, known as Bellatrix, will occur on September 6, and the second and final stage, Paris, will happen between September 10 and September 20. Although the team behind the Merge has been working hard for a few years on the updated version of Ethereum, this update will make life easier for crypto traders and investors in this highly volatile crypto market.
To learn about the impact of the Merge, click here!
To see which one is better – PoW or PoS; read the related blog here!
What was wrong with Ethereum 1.0?
To describe this, the Ethereum Foundation compares Ethereum to a spacecraft in midflight: “The community has built a new engine and a hardened hull. After significant testing, it’s almost time to hot-swap the new engine for the old mid-flight. This will merge the new, more efficient engine into the existing ship.”
So what went south with the old engine? A proof-of-work mechanism is utilized by Mainnet, the blockchain that has been in use since Ethereum’s launch in 2015, to add new transactions and other data securely. Before being enabled to add a new block, proof-of-work requires user computers to accomplish extremely challenging calculations. Numerous cryptocurrencies, including Bitcoin, use this process commonly known as mining. Although it is secure, mining consumes a lot of energy. Ethereum proof-of-work uses as much energy annually as several nations do in the same time frame.
A less energy-intensive alternative is proof-of-stake. Rather than contributing electricity, which drives computational power, users who want to participate in the verification process stake their crypto, a procedure similar to staking. These people, who are called validators, are chosen randomly to validate newly added data before it is added to a block. If they verify valid facts, they get Bitcoins. But, if they behave deceitfully, they could risk losing their stake.
What can you expect from Ethereum 2.0?
This transition is being done to cut back on unnecessary energy use. Additionally, it will bring brand-new “builders” to the blockchain ecosystem.
The change is expected to mark a smooth and seamless milestone for the cryptocurrency industry. Several companies and other stakeholders are using their forecasts.
About 3,400 applications are running on the Ethereum network, all of which have active trading that could be impacted by a bug or failure when the new software is being put in place. However, if it happens, it won’t be the first time Ethereum will experience malfunctions or hacks.
But after taking lessons from the past, all security precautions have been taken in the most recent update. On the day of the Merge, though, if the hackers are able to find a loophole in a smart contract created by one of the hundreds of existing applications, they could attack the whole network.
The crypto companies have previously stated that they will halt their trading operations based on the Ethereum network to avoid uncertainties and reduce the likelihood of issues on the day of the merger. DeFi applications and other trading platforms are anticipated to follow suit.
What does Ethereum Merge mean for you?
You probably don’t have to do anything if you own crypto assets. However, this might provide a more eco-friendly choice for those who are interested in crypto, and it might have some effect on their prices.
After the Ethereum Merge happens, what will it mean for your ether holdings?
The Ethereum Foundation states that there is nothing you need to do if you own ether, the second most famous crypto after Bitcoin and the native token of the Ethereum network. But be wary of scammers. If an application, crypto exchange, or wallet offers you recommendations or instructions, first verify the alerts coming from those platforms, the Ethereum Foundation advised in a blog post.
This may be good news for socially conscious traders who are concerned about the environmental effects of cryptos.
What will be the impact of Ethereum Merge on ether’s price?
This year has been exceptionally hard for crypto prices. Cryptocurrencies like Bitcoin and ether, along with other financial assets like stocks, have recently witnessed big dips after a great few years that included record-high values in November last year. Both Ether and Bitcoin have decreased by about 55% since the start of the year.
The price of ether, however, which has been surpassing Bitcoin during much of the recent recovery of cryptocurrencies, may be influenced by this Merge.
Here’s a YouTube video on “The Historic Ethereum Merge”: