The significance of next week's Ethereum Merge is beginning to be recognized by mainstream media outlets, who are describing it as a major overhaul that could either expedite crypto adoption or send catastrophic shockwaves throughout the market if it fails.

The Merge has been in the works since the original platform white paper. It includes transitioning from an energy-intensive proof-of-work (PoW) consensus algorithm to an efficient proof-of-stake (PoS) consensus mechanism with no significant disruptions to the blockchain.

The no-downtime upgrade was compared to "changing the engine of a spaceship in mid-flight" by American business publication Forbes, and Swan Bitcoin CEO Cory Klippsten issued a similar comment to the Wall Street Journal, stating that the upgrade is like trying to fix an airplane in mid-flight.

Some media outlets warned that the upgrade could be dangerous, fearing that one wrong step could prove devastating for the network and the platform blockchain's decentralized applications (DApps).

According to the Evening Standard, traders have been holding their breath in anticipation of the upcoming Merge, as a failed upgrade might risk the whole cryptocurrency ecosystem.

Defillama said that the network is accountable for the majority of the $150 billion stablecoin market cap and approximately $33 billion in total worth frozen by Ethereum-based decentralized applications (DApps).

Dr. Anna Becker, CEO, and co-founder of EndoTech told the Standard that if something goes wrong with the blockchain, it will be pretty difficult for the sector to survive.

"Because Ethereum is the infrastructure for many businesses to manage their blockchains, if something goes wrong, the industry will come to a halt [...] it will be quite difficult for the industry to survive this period."

The Washington Post stated that because the proof-of-stake mechanism is less battle-tested than proof-of-work, the stability of which has been proven for more than a decade, new vulnerabilities could be discovered.

Journalist John Quiggin of the Australian national broadcaster ABC incorporated in his reporting that because the new model has only been evaluated on experimental blockchains, the Ethereum experiment might fail, possibly if larger ETH stakeholders find a way to exploit the system.

According to the Ethereum Foundation, the Ethereum update will make the blockchain far more environmentally friendly than before, reducing energy use by more than 99%.

Some argue that this will exert pressure on other proof-of-work cryptocurrencies like Bitcoin to follow suit.

"At a time when the entire world is badly trying to decrease energy consumption, Bitcoin consumes more energy per year than medium-sized countries like Argentina," said Quiggin, adding, "If the Ethereum switch is successful, Bitcoin and other cryptocurrencies will face enormous pressure to address this issue."

Quiggin pointed out that Tesla announced last year that it would no longer accept Bitcoin payments until nearly half of the digital currency is mined utilizing renewable energy. The New York Legislature passed legislation to scrutinize Bitcoin miners who use carbon-based power earlier this year.

"One thing is certain: as the urgency to reduce global emissions grows, cryptocurrencies will run out of reasons for their outrageous energy consumption," he concluded.

As per CoinMarketCap, Ether (ETH) is currently the second-largest cryptocurrency by market cap, with a market cap of $187.5 billion, trailing Bitcoin (BTCmarket)'s cap of $360 billion.

Posted 
Sep 7, 2022
 in 
Crypto News
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