Why does Ethereum’s Merge make a lot of sense?

This article sorts out  the views of the DEX aggregation protocol Li.Finance on social media platforms, and the rhythm BlockBeats organizes and translates it as follows:  

The Ethereum merger is scheduled to take place on June 22, 3 months from now. This merger may be one of the most historic events in the history of cryptocurrencies. The following sections explain why the merge event is so important.

First, this merger is Ethereum’s full transition from Proof of Work (PoW) to Proof of Stake (PoS).

Why does Ethereum's Merge make a lot of sense?

Much of the groundwork required to perform the merge has already been done:

  • Beacon Chain is online
  • There has been a simulated fork
  • PoS already has some client friendliness

Until recently, people didn’t care about the Ethereum merger and its impact. However, with the launch of the Kiln testnet and the efforts of the big players in the circle to popularize everyone’s knowledge about mergers, a new theory has gradually formed.

The list of preparations for the merged mainnet is nearly complete. If all goes well without surprises, it will be possible to see the merger as scheduled in June. (Checklist)

The following are the major changes after the merger:

The issuance of new ETH will be reduced by 90%, i.e. the daily production of Ethereum will be reduced by about 90%, from 12,000 ETH per day to 1280 ETH. ETH annual inflation will drop from 4.3% to 0.43%.

Increased rewards for PoS validators – more than 10.65 million ETH is staked in the beacon chain by more than 300,000 validators, and the current annual interest rate is 4.7%. These rewards will increase 2-3 times after the merger, to about 10-15%.

Why does Ethereum's Merge make a lot of sense?

Energy saving and green, ETH energy consumption will drop by 99.95%

Contrary to what many believe, Ethereum mainnet gas fees will not drop due to the merger. For gas fees, users can use the currently evolving L2, bridging through protocols such as LI.FI.

While the merger has greatly boosted the project, Ethereum developers have expressed concerns about the direction of the project. In their view, Ethereum is not going “in the direction of simplicity” and is increasing the complexity of the blockchain network.

Posted by:CoinYuppie,Reprinted with attribution to:https://coinyuppie.com/why-does-ethereums-merge-make-a-lot-of-sense/
Coinyuppie is an open information publishing platform, all information provided is not related to the views and positions of coinyuppie, and does not constitute any investment and financial advice. Users are expected to carefully screen and prevent risks.

Like (0)
Donate Buy me a coffee Buy me a coffee
Previous 2022-03-23 10:19
Next 2022-03-23 10:21

Related articles