Recently, Ethereum has begun to close in its much anticipated “merge” event, in which the blockchain switches from a PoW protocol to a PoS protocol. This merge got even closer as of yesterday as developers successfully completed a final dress rehearsal for it. Indeed, the world’s second-biggest cryptocurrency climbed as high as $1,927 on Thursday, marking its highest level since early June, according to data from CoinMetrics. The token was last trading at $1,901.69, up 4.4% on the day. With this merge will come a triple-halving event for the crypto, which means that the ETH supply will decline by approximately 80% to 90% through a process called ‘burning’. This deflationary pressure on the network is equal to halving the Bitcoin system three times and is hence called the “triple” halving. With such deflationary pressure as well as increased buying as success inches closer, the possibility for Ethereum skyrocketing is increased.
The finalized upgrade of the network’s infrastructure via the merge, will not only speed up transactions on the Ethereum network, but make it more energy-efficient to help address criticisms over the environmental impact of cryptocurrencies. Even though the two are purchased for separate reasons, the implications of Ethereum’s continued success include Bitcoin potentially losing more ground.
What do you think of the merge and will it really pan out the way the test did?
I am not a financial advisor and my comments should never be taken as financial advice. Investments come with risk, so always do your research and analysis beforehand.