Ethereum Merge has turned out to be the most important event in the crypto industry this year. Analysts and keen observers believe that it will have a huge impact on all sectors of the blockchain industry, such as decentralized finance (DeFi), non-fungible tokens (NFT), and Web3 games. So how will this all affect the Ethereum price?
Find more about Ethereum Merge and read the latest news in the crypto sector, and not only, with the Born2Invest business news mobile app.
What is Ethereum Merge?
Ethereum is a second-generation blockchain project based on the Proof-of-Work (PoW) principle. Over the years, many industry experts have concluded that while PoW is a secure framework, it has tremendous limitations.
For example, it is a very energy-intensive process that requires computers with advanced GPUs. In addition, transactions using this technology are very slow and expensive. The average cost of an Ethereum transaction today is about $15.
Therefore, Ethereum developers decided to start a gradual process of upgrading, which is called ETH 2.0. The goal was to move from proof-of-work to proof-of-stake (PoS). PoS blockchains rely on validators to confirm transactions.
In 2021, developers introduced the London Hard Fork, which introduced several features to the network. This is expected to make transactions faster, plus prospectors will have more incentives. For example, they will no longer receive transaction fees from the network. Another goal is to turn Ethereum into a deflationary platform.
Another important phase of Ethereum 2.0 was the introduction of the Beacon Chain. This chain brought staking to Ethereum. According to Staking Rewards, users have already invested over $32 billion worth of Ether coins.
When will Ethereum Merge take place?
Ethereum Merge is expected to take place in May or June this year. The goal is to merge the current Ethereum mainnet with the Beacon Chain – also the Proof-of-Stake network. This will mark the end of Ethereum’s proof-of-work principle.
Following this, sharding technology will be introduced to increase the speed of Ethereum. This is a process where blocks are split into smaller pieces called shards. In this way, throughput is increased, i.e. the number of transactions per second.
Sharding has already been used extensively by other blockchain projects such as Zilliqa, Near Protocol, Elrond and Polkadot. As a result, the number of transactions within the ETH blockchain is expected to increase from less than 20 to more than 1,000 per second.
As a result, analysts expect the Ethereum price to perform well in the coming months as the merger proceeds. For one, it will lead to more DeFi, NFT, and gaming projects on the platform.
The latest development regarding ETH 2.0 is that the Ethereum Foundation has conducted a big test to check its performance. So, should you take advantage of the situation now and buy Ethereum?
Ethereum Price Forecast
On the weekly chart, we can see that the ETH price has been struggling lately and has fallen below the Fibonacci retracement level of 38.2%. The cryptocurrency has fallen below the first support of the Andrews Pitchfork tool. It also seems that the price has formed a head and shoulders pattern, which is usually a bearish sign.
Therefore, there is a chance that the Ethereum price will remain under pressure until the merge time. I then expect it to resume the uptrend and possibly reach its all-time high at $5,000 again.
DISCLAIMER: This article was written by a third party contributor and does not reflect the opinion of Born2Invest, its management, staff or its associates. Please review our disclaimer for more information.
This article may include forward-looking statements. These forward-looking statements generally are identified by the words “believe,” “project,” “estimate,” “become,” “plan,” “will,” and similar expressions. These forward-looking statements involve known and unknown risks as well as uncertainties, including those discussed in the following cautionary statements and elsewhere in this article and on this site. Although the Company may believe that its expectations are based on reasonable assumptions, the actual results that the Company may achieve may differ materially from any forward-looking statements, which reflect the opinions of the management of the Company only as of the date hereof. Additionally, please make sure to read these important disclosures.
First published in CRYPTO MONDAY, a third-party contributor translated and adapted the article from the original. In case of discrepancy, the original will prevail.
Although we made reasonable efforts to provide accurate translations, some parts may be incorrect. Born2Invest assumes no responsibility for errors, omissions or ambiguities in the translations provided on this website. Any person or entity relying on translated content does so at their own risk. Born2Invest is not responsible for losses caused by such reliance on the accuracy or reliability of translated information. If you wish to report an error or inaccuracy in the translation, we encourage you to contact us.
MATIC Share Price Forecast: What Does Polygon Expect in the Current Bear Market?
Cryptocurrencies such as Bitcoin and Polygon have a close correlation with stocks. In most cases, they rise when leading indexes...
Coima sgr’s Porta Nuova Centrale Fund Secures €173.5 Million Green Financing
Coima sgr, founded and led by CEO Manfredi Catella, ended 2021 with assets under management up 6 percent to $9.74...
Canopy Growth Sales Disappoint, Stock Under Pressure
Just a week before announcing its latest numbers, Canopy announced its latest acquisition: the purchase of California-based cannabis extraction and...
Solidarity Day 2022: Ganzourgou Producers Offer 2.6 Tons of Food to Vulnerable People
Regarding the selection criteria of vulnerable people, Ambroise Ouédraogo said that his association collaborates with the provincial directorate of Social...
Ford Chooses Almussafes over Germany for the Production of Electric Models
Thus, the Valencian factory will be the fifth Spanish factory to produce all-electric models. Stellantis manufactures electric models at its...
Biotech1 week ago
Satellos Bioscience’s Stem Cell Signaling Research Could Turn the Tables on Muscular Dystrophies
Crypto2 weeks ago
Solana Price Forecast: SOL Forms a Dead Cat Bounce
Crowdfunding2 weeks ago
Exporo Raises Funds, but the Company Value Decreases Instead of Increasing
Cannabis2 weeks ago
Luis Figo Launches His Brand of CBD Products