Ethereum, ether (ETH) as its native token, is one of the most well-known altcoins within the digital market of cryptocurrencies. Investors and enthusiasts alike are treating ETH as more than a cryptocurrency. The origination and creation of NFTs and smart contracts attracted crypto investors to invest and capitalize on ETH.
Since its launch in 2015, Ethereum has significantly grown its value and is currently the second-largest cryptocurrency next to bitcoin. According to several reports and predictions by crypto experts, ETH’s value in the crypto market was expected to grow by more than 400% in the year 2022. But since the digital market of crypto crashed during the earlier weeks of May, ETH’s price, along with other cryptocurrencies in the market, had experienced a devastating crash. With the crash, it entered a bearish market, where its price decreased by 33% and was seen to continue on a downward trend.
The bearish market trend of Ethereum got its investors and supporters worried about their investments. But with the Ethereum Merge update that seems to be happening sometime soon, there seems to be hope for this cryptocurrency. The “Merge” that Ethereum refers to is the moment when Ethereum officially shifts from a proof-of-work consensus mechanism to a proof-of-stake consensus mechanism. It aims to eliminate adverse impacts on the environment of Ethereum’s functionality.
In terms of energy consumption, it is said that Merge could possibly reduce as much as 99% of its current energy consumption. With proof-of-stake, miners in the Ethereum blockchain will no longer compete to verify transactions on the blockchain by solving complex computational problems. And as a result of this, it is no longer necessary to buy and use sophisticated and much more expensive mining rigs, thus reducing the energy consumption significantly.
The shift in consensus mechanism also aims to dramatically change Ethereum’s transaction speed. It is said that everything within the Ethereum blockchain is going to be faster, cheaper, and more efficient. The transaction fees could fall, making Ethereum more accessible to a casual user.
But the talks about “The Merge” have been around for a long time now and have been delayed more than a few times than what investors expected. Vitalik Buterin, the creator of Ethereum, said that the upgrade would undergo in August when the Beacon chain, which is parallel to Ethereum’s blockchain and which is being tested for the proof-of-stake consensus mechanism, will merge with the primary network of Ethereum.
With all the technical upgrades and initiatives that are going to be implemented within their network, Ethereum might eventually become the number one cryptocurrency, overtaking Bitcoin. The success of the upgrade might give their supporters and investors hope worth waiting for.