Why is the Ethereum merger important? • Benzinga

[ad_1]

Want to get straight into crypto? You can buy Bitcoin or Ethereum on eToro.

When Ethereum was initially designed, co-founder Vitalik Buterin planned to transition Ethereum to a proof-of-stake (PoS) system. He knew that if the network grew in size, the proof-of-work (PoW) system would lose practicality. Ethereum has since become one of the biggest blockchains in the crypto space, and the need for a PoS system has become apparent. This shift from a PoW to a PoS consensus model (commonly referred to as “The Merge” or “The Ethereum Merge”) may happen very soon. Here’s what you need to know about The Merge before it happens.

Why is the Ethereum merger important?

The Ethereum merger is important for several reasons. Specifically, The Merge could have an immediate effect on the narrative and psychology of Ethereum supporters. The PoS system can make validation easier and more cost effective. This change would ease some of the financial burden on users who transact. It is also likely to reduce power consumption by up to 99.95%, according to the Ethereum organization.

What is Ethereum Merge?

The Ethereum Merge is a big part of the Ethereum Vision, a series of planned upgrades that should be mostly complete by 2024. These upgrades were previously known as ETH2.0 but have been renamed The Merge. This event is the second in a three-step upgrade process. The first update added the beacon chain, which is currently a testnet for the Ethereum chain. However, the merger occurs when the beacon chain becomes the consensus layer for the Ethereum mainnet. All data from the current Ethereum mainnet will be transferred to the Beacon Chain, which will become the new mainnet.

How will the merger affect Ethereum and the crypto market?

The merger will have an immediate effect on Ethereum. For starters, Ethereum will now have consensus PoS, replacing the PoW system and positively affecting the narrative behind Ethereum. These upgrades could also impact the price of ETH. If investors see that these changes are beneficial, they could buy the token and raise the price. Conversely, it could have a negative impact and the price could drop if the upgrades do not meet or exceed expectations.

When it comes to the overall crypto market, there are several changes that could occur quickly and over time. As Ethereum gas fees started to increase significantly at the end of 2021, many new blockchains have gained popularity due to their focus on speed and cost. These blockchains, such as Solana and Avalanche, could be negatively impacted if The Merge goes well for Ethereum. If The Merge is successful, it could eliminate the need for these other blockchains to some extent. This could drive up the price of ETH and other blockchains. The reverse could also be true.

How to trade Ethereum merger

The merger could essentially have three outcomes: the price of ETH increases, decreases, or stays the same.

For the price to rise, The Merge should succeed in improving the narratives behind ETH – such as the dramatic decrease in power consumption – and build hype for the upcoming upgrades. If that happens, investors could flock to the token and push the price up.

If there is a technical or other issue with The Merge itself, then many might be hesitant to invest in Ethereum and might sell their positions, driving the price down.

Finally, the price could remain the same. Some believe the hype and transparency surrounding The Merge means the event is likely already accounted for. Investors already know what is going to happen on the day of The Merge, so unless something extraordinary happens, the price may not change by much. However, even Buterin thinks the price is not yet factored in.

How you should trade The Merge depends on how you feel about it. If you think it will be a hit and it’s not priced yet, you can consider buying it. If you see it going badly, you might want to consider staying away.

How to buy Ethereum

Ethereum is one of the most widely available cryptocurrencies and can be purchased on a variety of crypto trading platforms. Two of the best are eToro and Robinhood. Both also allow you to trade stocks and cryptos with the same app!

To get started on any of these fantastic platforms, go to the platform to register and verify your account. From there, connect your bank account and start trading.

eToro

Begin

securely through the eToro website

Disclosure: This advertisement promotes investing in virtual cryptocurrency within the EU (by eToro Europe Ltd. and eToro UK Ltd.) and the United States (by eToro USA LLC); which is highly volatile, unregulated in most EU countries, without EU protection and unsupervised by the EU regulatory framework. Investments are subject to market risk, including loss of principal.

Exam in 1 minute

eToro is headquartered in Cyprus, England and Israel. A major strength of eToro is its social trading operations, which allow new clients to copy the platform’s best performance. Its social trading features are top-notch, but eToro loses points for its disappointing search features and customer service.

Best for

  • Investors looking to CopyTrade with other traders
  • Simplified user interface
Advantages

  • Several major cryptocurrencies and altcoins
  • Extensive network of social trading features
  • Large customer base for new traders to emulate

Robin Hood

Begin

securely through the Robinhood website

Best for

Buy and sell Dogecoins

Exam in 1 minute

Robinhood is the broker for traders who want a simple, easy-to-understand layout without all the bells and whistles offered by other brokers. Although its trading options and account types are limited, even an absolute beginner can quickly master Robinhood’s intuitive and streamlined platform. On the other hand, more advanced traders might be frustrated by Robinhood’s lack of technical analysis tools, a feature now almost universal on other platforms.

Best for

  • Free negotiation
  • Newbie Crypto Investors
  • Doge Day Merchants
Advantages

  • Trade without commission
  • Access to Dogecoin
The inconvenients

  • Limited selection of altcoins
  • No wallet capacity

When is the Ethereum merger?

The Ethereum organization has stated that there is a soft deadline of September 19, 2022 for The Merge. However, many believe it will happen on September 15, 2022 at 3:00 UTC depending on when the Total Terminal Difficulty (TTD) moment reaches a certain level. The Bellatrix update is complete, so the merge is the next step and is coming very soon.

What’s next for Ethereum?

While Ethereum hopes to fix some of its issues with The Merge, another big problem still looms. The question of capacity has arisen more recently in the Ethereum community. The chain processes so much information that it struggles to process it and store it on the blockchain. Hopefully, this problem will be addressed by a brilliant, highly technical process called sharding. The upgrade, scheduled for 2023, will distribute data storage across the blockchain and reduce the amount of data stored on a single node. This highly technical idea has been difficult to put into practice, so it will take some time for the final implementation to kick off.

Hopefully, sharding will further increase the security and scalability of Ethereum by spreading the load across multiple blockchain shards.

So, is Ethereum a good investment right now?

The merger is bound to bring big changes to the Ethereum blockchain. However, in terms of investment, these changes could have distinct impacts on the price of the token. If you think The Merge will provide benefits to Ethereum users that aren’t already accounted for, it may be worth the investment. Conversely, if you think The Merge will wreak havoc on the chain or is already priced in, you might want to steer clear of an investment.

The decision to invest in ETH depends on your personal view of The Merge.

[ad_2]

Source link

Recent Articles

Terra Luna

Wolverine Coin

TABOO TOKEN

Crypto Heirloom

spot_img

Related Stories

Stay on op - Ge the daily news in your inbox

bitcoin
Bitcoin (BTC) $ 17,209.75
ethereum
Ethereum (ETH) $ 1,277.07
tether
Tether (USDT) $ 0.999951
bnb
BNB (BNB) $ 289.82
usd-coin
USD Coin (USDC) $ 0.99962
binance-usd
Binance USD (BUSD) $ 0.99982
xrp
XRP (XRP) $ 0.393102
dogecoin
Dogecoin (DOGE) $ 0.098184
cardano
Cardano (ADA) $ 0.314402
matic-network
Polygon (MATIC) $ 0.92507
polkadot
Polkadot (DOT) $ 5.41
staked-ether
Lido Staked Ether (STETH) $ 1,261.65
litecoin
Litecoin (LTC) $ 78.01
shiba-inu
Shiba Inu (SHIB) $ 0.000009
okb
OKB (OKB) $ 20.82
dai
Dai (DAI) $ 1.00
tron
TRON (TRX) $ 0.054424
solana
Solana (SOL) $ 13.67
uniswap
Uniswap (UNI) $ 6.15
avalanche-2
Avalanche (AVAX) $ 13.43
leo-token
LEO Token (LEO) $ 3.79
wrapped-bitcoin
Wrapped Bitcoin (WBTC) $ 17,187.59
chainlink
Chainlink (LINK) $ 6.98
cosmos
Cosmos Hub (ATOM) $ 9.84
the-open-network
Toncoin (TON) $ 1.82
monero
Monero (XMR) $ 146.75
ethereum-classic
Ethereum Classic (ETC) $ 19.15
stellar
Stellar (XLM) $ 0.085764
bitcoin-cash
Bitcoin Cash (BCH) $ 111.93
quant-network
Quant (QNT) $ 123.08
crypto-com-chain
Cronos (CRO) $ 0.064432
algorand
Algorand (ALGO) $ 0.224315
filecoin
Filecoin (FIL) $ 4.41
near
NEAR Protocol (NEAR) $ 1.71
apecoin
ApeCoin (APE) $ 3.93
vechain
VeChain (VET) $ 0.01901
hedera-hashgraph
Hedera (HBAR) $ 0.047945
internet-computer
Internet Computer (ICP) $ 4.27
eos
EOS (EOS) $ 1.03
elrond-erd-2
MultiversX (Elrond) (EGLD) $ 45.55
flow
Flow (FLOW) $ 1.04
trust-wallet-token
Trust Wallet (TWT) $ 2.60
terra-luna
Terra Luna Classic (LUNC) $ 0.000176
frax
Frax (FRAX) $ 0.997985
axie-infinity
Axie Infinity (AXS) $ 8.18
the-sandbox
The Sandbox (SAND) $ 0.592224
tezos
Tezos (XTZ) $ 1.00
aave
Aave (AAVE) $ 62.93
theta-token
Theta Network (THETA) $ 0.874678
huobi-token
Huobi (HT) $ 6.48
lido-dao
Lido DAO (LDO) $ 1.04
bitcoin-sv
Bitcoin SV (BSV) $ 43.19
chain-2
Chain (XCN) $ 0.038171
chiliz
Chiliz (CHZ) $ 0.152963
true-usd
TrueUSD (TUSD) $ 0.999182
paxos-standard
Pax Dollar (USDP) $ 0.999235
decentraland
Decentraland (MANA) $ 0.399203
usdd
USDD (USDD) $ 0.974137
bittorrent
BitTorrent (BTT) $ 0.00000067998419
pancakeswap-token
PancakeSwap (CAKE) $ 3.96
kucoin-shares
KuCoin (KCS) $ 6.57
aptos
Aptos (APT) $ 4.89
fantom
Fantom (FTM) $ 0.23639
gemini-dollar
Gemini Dollar (GUSD) $ 1.00
zcash
Zcash (ZEC) $ 44.80
iota
IOTA (MIOTA) $ 0.20858
compound-usd-coin
cUSDC (CUSDC) $ 0.022685
tokenize-xchange
Tokenize Xchange (TKX) $ 7.14
whitebit
WhiteBIT Token (WBT) $ 4.75
ecash
eCash (XEC) $ 0.000029
klay-token
Klaytn (KLAY) $ 0.187016
maker
Maker (MKR) $ 620.40
gatechain-token
Gate (GT) $ 3.56
neo
NEO (NEO) $ 7.07
dash
Dash (DASH) $ 44.70
radix
Radix (XRD) $ 0.048294
pax-gold
PAX Gold (PAXG) $ 1,785.93
the-graph
The Graph (GRT) $ 0.063445
havven
Synthetix Network (SNX) $ 1.95
arweave
Arweave (AR) $ 9.13
osmosis
Osmosis (OSMO) $ 0.919652
compound-ether
cETH (CETH) $ 25.63
gmx
GMX (GMX) $ 53.51
frax-share
Frax Share (FXS) $ 6.08
curve-dao-token
Curve DAO (CRV) $ 0.666258
thorchain
THORChain (RUNE) $ 1.42
tether-gold
Tether Gold (XAUT) $ 1,727.15
mina-protocol
Mina Protocol (MINA) $ 0.555097
cdai
cDAI (CDAI) $ 0.022123
btse-token
BTSE Token (BTSE) $ 2.55
ethereum-pow-iou
EthereumPoW (ETHW) $ 3.69
rocket-pool
Rocket Pool (RPL) $ 20.17
nexo
NEXO (NEXO) $ 0.669167
blockstack
Stacks (STX) $ 0.261554
ethereum-name-service
Ethereum Name Service (ENS) $ 13.57
1inch
1inch (1INCH) $ 0.445583
basic-attention-token
Basic Attention (BAT) $ 0.226464
zilliqa
Zilliqa (ZIL) $ 0.022215
bitdao
BitDAO (BIT) $ 0.309977
immutable-x
ImmutableX (IMX) $ 0.443434