With the much anticipated Ethereum merge only 11 days away, much is being made of the projected changes to the network. However, arguably the biggest change is the massive decrease in energy consumption.What is to become of Ethereum mining?
When Ethereum transitions from proof-of-work to proof-of-stake consensus, it will go from energy intensive mining to an almost negligible use of energy. In order to incentivise miners to stop mining, a Difficulty Bomb will make it impractible for them to continue.
The miners will have the choice of becoming validators for the new chain or they could continue mining by switching over to the Ethereum Classic fork.Ethereum fork viability
Another choice for the miners is to jump onto a new PoW chain should a hard fork be introduced. The chances of this happening are fairly likely, and some miners may choose to try their luck here.
The ETHPOW token would be the native token for the new PoW chain and is predicted to launch at a price of at least $18. Holders of ETH will receive the token for free. Those who hold ETH on an exchange will need to check that it will support the new token.
However, some experts are saying that the potential PoW chain fork will not gain much traction, given the lack of any Oracle support, the fact that most dApps support the merge, and also, the Ethereum Classic case shows that very few developers worked on it.Not faster and cheaper yet
There has been some miscommunication about the merge, especially among retail investors, that it will bring a much cheaper and faster network for users.
The Ethereum Foundation has clarified that these particular benefits will not necessarily happen yet, but that energy efficiency will be much more enhanced. Meaning that all dApps that place a premium on energy efficiency are likely to remain on the Ethereum blockchain.
Iacov Levin, CEO and Founder of Midas Investments, a long-term wealth generation platform with $200 million under management, stated:
“Most likely, the transition to energy efficiency by Ethereum will be set as a standard or a yardstick upon which many other energy-consuming blockchain protocols will be gauged in the near future. The narrative amongst investors, asset managers, and regulators will be that if Ethereum can successfully transition, then other PoW protocols should also be able to transition for the greater good of all.”After the Merge
If successful, the Merge will go a long way towards establishing the continuance of Ethereum as the primary smart contract blockchain for future development.
Levin had the following to say on how he thinks Ethereum will close the gap on Bitcoin:
“Ethereum is bound to become increasingly reckoned with as an energy-efficient blockchain, decoupling from the negative sentiment plaguing Bitcoin as a major factor fueling environmental climatic degradation. By virtue of this changed outlook, institutional investors may be more inclined to stack up on the asset, thus pushing it to close the pricing gap between it and Bitcoin.”
Disclaimer: This article is provided for informational purposes only. It is not offered or intended to be used as legal, tax, investment, financial, or other advice.