Although it was widely expected by experts, few people in the crypto world wanted to accept it. The Ethereum blockchain merger that happened yesterday didn’t result in a real surge; instead, the price went the other way.
I’m hoping this is simply another “sell the news” incident. However, things may be far worse. A sales avalanche might be set off if the Ether community discovers that the merger does not result in the improvements that were mistakenly anticipated.
The network’s transition from proof-of-work to proof-of-stake was the sole goal of the merger. The amount of energy used decreased by 99% as a result. a reality that, in light of climate change, we may be glad of. However, the performance of the blockchain and gas prices are unaffected by the merger. But it is precisely these areas that restrict the ecosystem’s expansion.
This issue has already been addressed in an effort to build so-called layer 2 solutions. However, as Aloe CEO Haward Wu said, their performance is also closely correlated with the level 1 Ethereum platform.
“The high gas tariffs for layer 2 can only be reduced if the transaction speed of Ethereum increases.”
There is no doubt that the merger was a success and that Ether is no longer a dated technology from 2015, but there is no disputing that the blockchain has surpassed Solana and Cardano in terms of technology.
A challenge that Jeff Galloway, co-founder of SafeCoin, the blockchain with the highest energy efficiency and performance, previously identified in August:
“When the merger is fully implemented, the blockchain will reach a level where many of its competitors were technologically in 2020… For Ethereum to achieve performance and energy efficiency comparable to that of SafeCoin and Solana, it would take a processing of multithreaded transactions, but this would only be possible if the entire code were completely rewritten.
Eth 2.0’s on-chain architecture makes this nearly impossible, which relates to the increasing complexity of development and the increasing difficulty of making competent governance decisions.”
Developer Jeff Galloway is an expert in his field. Similarly, SafeCoin began in 2018 as a blockchain that only utilized proof-of-work. But it became obvious two years later that switching to proof of stake was the only viable option. The team opted to use the Solana code as the foundation for their new project after conducting extensive study for months.
While the Solana code has seen major advancements, PoW coins have been exchanged 1:1. The blockchain became more secure thanks to the creation of the first random voting system in history, which also resulted in a 100-fold reduction in the power required for the consensus process. One of the team’s focuses, along with better security, was the power efficiency, which was multiplied by three thousand in comparison to Solana:
“We are also working on CO₂ credits for our channel and applications in our ecosystem like decentralized exchanges, NFT markets and many more, which have been released recently or are in development.
Additionally, we are about to launch decentralized exchanges that will not only enable much higher performance and speed than before, but will also reduce the carbon footprint of markets as traders and market makers adopt the technology. . The SafeCoin community is exploring different possibilities to achieve 100x carbon negativity by the end of 2023, with the aim of significantly influencing the crypto universe in terms of environmental impact.”
This demonstrates how far technology has already advanced and the challenging path Ethereum must go to maintain its present market position. Ether and Layer 2 solutions will struggle to survive if they can’t keep up with market needs and technical improvements.
technical requirements for Ethereum
Ethereum is now down -10.65% to $1461, and is down -13.72% on a weekly basis.
On September 10, the price fell further after crossing over the 23.6% Fibo retracement at $1757. Currently, a test of the 50% Fibo retracement of $1455 is being made after the breakthrough of the 38.2% Fibo retracement of $1590.
Expect losses to the $1424 low set on August 28 and the $1320 level of the 61.8% Fibo retracement if this support is unable to withstand downward pressure.