
The Ethereum Merge has happened
already. The Merge has some implications for Ethereum.Ā It has the potential to also catapult the
price of ether or ETH to unprecedented heights. There are some other benefits
expected of the event.
Top Benefits of
The Ethereum Merge
There are drawbacks to Ethereum that
the Merge is expected to fix. The event means that the lack of scalability
which used to be the roadblock to Ethereumās greater adoption is no longer an
issue. Here are some other top benefits of the Ethereum Merge crypto followers
should expect.
Read more: What Is the Ethereum Merge?
1.Ā
More users are allowed to participate in the network
Many Ethereum network participants
will benefit from the Merge because many of them will now be able to earn
rewards for participating and securing the network. The transition to proof-of-stake
(PoS) from proof-of-work (PoW) ensures that miners will no longer validate
transactions on the network.
What this means is that transactions
will be processed through staking. Ethereum users can āstakeā or commit a
fraction of their Ethereum holding towards securing the network and validating
transactions to receive a share of transaction fees. Staking is more accessible
to the everyday Ethereum user. This is unlike mining which requires a
considerable deal of effort and upfront investment to engage in.
However, there exist some roadblocks
to entry. Holders must invest a minimum of 32 Ethereum to maintain their nodes
for validating transactions. This is cost-prohibitive to investors.
Nevertheless, services such as Lido Finance and Coinbase now allow customers to
hold less than 32 Ethereum. This is done by facilitating staking in a
relatively automated and simple process so that customers can enjoy these
benefits.
Users should be informed that they
won't be able to trade some of their Ethereum for a long after staking some of
it on Coinbase. However, long-term holders shouldn't have any problems with
this.
Read more: Proof-of-Stake explained
2.Ā
The Merge makes sharding possible
Even with the Ethereum Merge going
live, Ethereum is still a blockchain under development. Ethereum co-founder,
Vitalik Buterin still views Ethereum as being 55% complete. Two things need to
take place before Ethereum can reach its full potential ā lowering transaction
fees and increase in transaction speed.
The Merge will not directly solve
this but is still a necessary step toward the solution. The Merge will lay the
groundwork for Ethereum to eventually expand its capacity and become faster and
less expensive. To accomplish this, the process known as sharding will be
introduced.
With sharding, the Ethereum
blockchain will be divided into smaller, more manageable blockchains. Validators
will be more effective because they will be able to concentrate their efforts
solely on transactions that take place within their shard. Sharding will also
lower the barrier associated with being a validator.
3.Ā
Ethereum is now more eco-friendly
Ethereum becoming more
environmentally friendly has been one of the most publicized benefits of the
Merge.
When the Ethereum blockchain
operated on a PoW consensus mechanism, massive computational power was required
to solve complex math problems just to validate new transactions on the
blockchain. It was cited as being energy-intensive, expensive, and slow.
According to the official website of
Ethereum, the Merge which involved a transition from PoW to PoS consensus
mechanism ensures that there will be a 99.95% reduction in energy consumption.
This means that expensive and high-powered computers will no longer be needed
to run Ethereumās network.
Conclusion
The Ethereum blockchain, the biggest
after bitcoin has undergone a major upgrade. The Merge as it is known will make
Ethereum more energy efficient, make sharding possible, and allow more users to
participate in the network. As a result, users should expect improvements and
more benefits in the months and years to come.
DISCLOSURE
Comments here are not of the author's opinion. Users are responsible for their comments.