The Ethereum “Merge” – What It Means for the Future of Cryptocurrency

Even while cryptocurrency is becoming more mainstream, it’s still a volatile asset to invest in. With over $1 trillion in lost value in 2022 alone, several would-be investors are understandably scared to park any of their assets in any crypto project.

That being said, the crypto world is constantly changing. As of September 15, 2022, Ethereum finished its much-awaited “merge” to proof-of-stake (PoS). This change was done to make transactions much faster for Ethereum investors.

So, what else will Ether’s game-changing transformation mean for the future of crypto? Our quick guide has everything you need to know!

What Exactly Does The Ethereum “Merge” Mean?

Starting as early as 2014, Ethereum founder Vitalik Buterin had been hinting at a possible evolution of the platform to a PoS model in the near future. Researchers and developers have been working on combining Ethereum’s proof-of-work (PoW) layer with its PoS, also known as its consensus layer.

The “merge” marked the final move towards PoS, abandoning the PoW system altogether. This move was essential to opening the platform to faster transactions, less energy consumption, and infinite scalability.

Benefits Of The Ethereum Merge

As reported earlier, Ethereum’s upgrade laid the foundation for a more stable future. Here are some of the main benefits of the platform’s merge:

Ethereum Merge Makes Crypto More Sustainable

Before Ethereum’s transition, the platform operated on the energy-intensive PoW, just like Bitcoin. This system requires crypto miners to solve complicated puzzles and get rewarded by adding their “hash” to the blockchain. Even if it ensures secure transactions, PoW needs a lot of energy and resources to work.

On the other hand, Ethereum’s new proof-of-stake PoS mechanism is more decentralized and faster, and miners stake their own capital instead of solving computations. This newer method uses over 99% less energy than its previous model!

More Users Can Join Ethereum’s Network

Ethereum can now also process thousands of transactions at a time. Validators no longer need a miner because the platform has enabled everyone to benefit from joining the network and keeping it secure.

Crypto mining is a lot more expensive, but with staking, you would need a minimum of 33 ETH to run your own node. If you have less than that, no worries! You can stake a lesser value through platforms like Coinbase with only a few clicks and earn up to 5.75% APY.

Increased Ethereum Network Efficiency

Part of the reason for Ethereum merge? To prep its blockchain for even more future updates, such as sharding. Simply put, sharding is breaking apart a database into smaller blockchains. This makes the platform perform faster and encourages even more transactions.

Once sharding becomes a thing, being a validator will also be easier. Since each person would only be responsible for their blockchain data, a standard phone or laptop would be all they need to run their own node.

Will The Merge Cause Ethereum’s Value To Soar?

So far, the merge hasn’t affected Ethereum’s price all that much. You’re probably wondering if ETH’s value will shoot to the moon by the end of this year – that’s yet to be determined. After the most recent crypto crash in July, the price has held steadily between $1,000 and $1,600 per coin.

Time will tell if this new update will have a long-term impact on the coin’s value. But based on its changes, there’s no reason why Ethereum wouldn’t rise soon. Now would be the time to buy the dip and take advantage of the recent bear market.

The Bottom Line

Ethereum’s recent merge and new PoS have undoubtedly drawn the attention of new investors. Future updates will only make the platform faster, safer, and open to new projects.

Considering how rapidly crypto investments are changing, Ethereum could permanently solidify itself as the go-to coin for investors seeking a “safe” investment. And due to Ethereum’s second-largest market capitalization (second only to Bitcoin), its merger also has the power to boost the long-term prices of other cryptocurrencies, too.

Now is a great chance to do your research and invest in ETH if you haven’t done so already!