What will Happen to Your ETHs After the Merge?
Ethereum is only days away from the highly-anticipated merge, which will see the network transition from a Proof-of-Work (PoW) chain into Proof-of-Stake (PoS) consensus.
The Merge is an event that will see Ethereum’s current PoW mainnet protocol combined with the Beacon Chain PoS blockchain system and continue as PoS. As switches chains in one of the biggest crypto events in history, what will happen to all your ETH?
What will Happen to Your ETH After the Merge?
If you hold your ETH on exchanges that support Ethereum’s transition to PoS, then you do not need to worry about what will happen to your ETH after the event. All Ethereum you hold will appear in your wallet after the merge is complete.
Ethereum has told ETH holders that despite swapping out proof-of-work during the merge, the entire history of Ethereum since genesis remains intact and unaltered after the transition to proof-of-stake.
Exchanges have assured users that their ETH will safe and secure during this period. In addition, all ETH you hold on exchanges wallets will become accessible to you after the merge is complete.
Is There An ETH 2.0 Token?
Holders of the original Ethereum (ETH) tokens have been warned that there is no ETH 2.0 token, and as such, no there will be no upgrading of tokens. Beware of scammers who ask you to send your ETH to them for an “upgrade to ETH2.”
No actions would be required of ETH holders, as exchanges will automatically transfer their tokens over after The Merge. If you find an ETH2 ticker, they were set by exchanges as Ethereum will not be issuing new tokens before, during, or after the merge.
What will Happen to My Staked ETH?
Staked ETH (ETH2) balances won’t be unlocked at the time of the Merge or be available to trade or transfer until the Ethereum protocol upgrade completes. The upgrade is anticipated to be completed by early 2023.
However, Ethereum has announced that stakers running their individual nodes would need to run both a consensus layer client and an execution layer client; third-party endpoints to obtain execution data will be unavailable after The Merge.
After that, they will need to authenticate both the execution layer and consensus layer clients with a shared JWT secret so they can securely communicate. Lastly, they will need to set a fee recipient address to receive your earned transaction fee tips/MEV.
If these processes aren’t completed, the Ethereum network will read your node as being “offline,” until both layers are synced and authenticated. To get the resources for the upgrade, click here.
What will Happen to Ethereum After the Merge?
One of the first things that will happen immediately after the merge is the triple halving or a near equivalent to three halvings. The merge will reduce ETH’s inflation rate from 4.3% to 0.43%. The daily block reward will also get reduced to one-tenth.
Post-merge, Ethereum will enter a four-phased development process to make its PoS blockchain more scalable and secure. The four phases are the Surge, the Verge, the Purge, and the Splurge.
At the end of the Splurge, Vitalik Buterin, Ethereum’s co-founder predicted that the network will be able to process up to 100,000 transactions per second.
Will the Merge Affect the Price of Ethereum?
This is perhaps the most asked question about Ethereum holders. Market analysts have predicted that the merge will induce a period of high volatility in not just ETH, but the broader crypto market.
The reduction of Ethereum’s inflation rate (triple halving) has been predicted to affect the price of ETH positively. Although Ethereum currently trades at $1,650, the price of ETH could rally as high as $5,000 post-merge.
On the Flipside
- As Ethereum migrates to PoS, groups of miners have hard-forked the blockchain in order to remain on a PoW blockchain.
Why You Should Care
In migrating to the more sustainable, scalable, and eco-friendly Ethereum, holders of ETH are not required to perform any operation (asides from stakers) and avoid scammers wanting to take advantage of the upgrade.
For all the latest Business News Click Here
For the latest news and updates, follow us on Google News.