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Ether is preparing for an epic “meltdown” in its quest to eclipse bitcoin

Ether promised to do better. It promised to take it to the next level, outpacing its crypto rivals and even surpassing the godfather, bitcoin. But time is running out.

The No. 2 cryptocurrency was supposed to be weeks away from “melting,” a transformative June upgrade to its Ethereum blockchain to make it faster, cheaper and less power-hungry, offering the prospect of a nastier and cleaner crypto future.

Anticipation had supported Ether this year, even as inflation and monetary tightening hampered bitcoin. But that merger – which would see ether mining shift from the energy-intensive proof-of-work method to proof-of-stake – has been delayed, frustrating investors.

“The timeline to see this launch continues to lengthen,” said Brendan Playford, founder and CEO of decentralized financial data platform Masa Finance.

“It is certainly plausible that Ethereum’s long-awaited upgrade to a proof-of-stake system will be delayed again given that this transition is very complicated and it is still uncertain whether it can actually hold its own. promise to reduce costs and increase transaction speeds.”

Ether fell 8% from $3,215 to $2,947 on April 11, the day Ethereum lead developer Tim Beiko tweeted that the June rollout had been pushed back as testing heats up. were continuing. It is down 13% this month, at $2,844.

“It won’t be in June, but probably in the next few months,” Beiko wrote in his tweet. “No firm date yet, but we’re definitely in the final chapter.”

The timing of the merger – Ethereum’s EH1 chain will merge with a new chain to create ETH2 – remains uncertain, although many crypto watchers expect it to happen this year. Mr. Beiko did not respond to a request for comment via Twitter and LinkedIn.


Ether’s market cap of $363 billion is less than half that of bitcoin, and together the two make up 60% of the crypto market.

Yet bitcoin remains just an investment with no real ability to be used for contracts in decentralized financial applications. For this reason, many investors believe a market reversal is inevitable – dubbed “the flip” in crypto circles – with the merger acting as a catalyst for Ethereum to become the dominant platform.

“We are seeing a rotation of funds into Ethereum in preparation for the merger, although we don’t know when that will happen,” said Noelle Acheson, head of market intelligence at Genesis Trading. The buying interest, she said, “indicated that more funds seem to appreciate than [Ethereum] is perhaps undervalued at this stage”.

Bitcoin and ether are mined or produced using a proof-of-work (POW) method, where thousands of miners, or network nodes, compete to solve complex mathematical puzzles.

It’s a massively power-hungry process that is estimated to cause more pollution each year than a small country, raising fears about crypto in a low-carbon world.

The alternative proof-of-stake (POS) method uses much less energy because, rather than running millions of computers to process the puzzles, it allows the nodes that stake the most coins to validate the transactions.

Ethereum has long been hampered by speed and processing cost issues. It only processes 30 transactions per second as a proof-of-work blockchain, but expects to process up to 100,000 transactions per second once it hits the point of sale.

This will allow it to compete with other smaller altcoins such as Solana and Cardano, which use POS partially or entirely, for decentralized financial applications such as trading, investing, borrowing and even non-POS tokens. fungible.

This is on condition that Ethereum gets its upgrade.

“Ethereum maxis, people who believe in ‘rollover’, believe it will happen very soon,” said Ms. Acheson of Genesis Trading. “But that’s just a theory and that remains to be seen.”

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