Kategorie: Ethereum News

Cryptocurrency exchange FTX has announced that it shall temporarily freeze trading Ether (ETH) on several blockchains as the Ethereum Merge nears.

The halt will last until The Merge is completed as a way of taking extra precautionary measures to safeguard investors’ funds during the Ethereum upgrade.

After the Merge, Ethereum blockchain will gradually switch from a Proof-of-Work (PoW) consensus mechanism to a Proof-of-Stake (PoS) consensus mechanism.

FTX said:

“As the ETH merge approaches, FTX will temporarily disable blockchain transfers of secondary chains for ETH to make sure that settlement is clean; the main chain ETH will stay active for longer.”

FTX’s move comes despite Ethereum developers’ assurance that the Terminal Total Difficulty (TTD) is what will allow the Merge to switch to PoS with no downtime. TTD will enable the transition based on the total mining power that will go into generating the new chain.

The Merge will not lower gas prices

Depsite switching from PoW, which is considered more costly, to PoS, which is considered to be cheaper, the Ethereum Foundation has stated that the Merge will not result to a reduction of gas prices.

An announcement from Ethereum Foundation reads:

“Gas fees are a product of network demand relative to the network’s capacity. The Merge deprecates the use of Proof-of-Work, transitioning to Proof-of-Stake for consensus, but does not significantly change any parameters that directly influence network capacity or throughout.”

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Ethereum blockchain has been working hard to migrate from the current proof-of-work (PoW) consensus mechanism to a proof-of-stake (PoS) consensus mechanism. The process of moving from PoW to PoS is expected to culminate with the much-anticipated Merge upgrade.

In 2020 several testnents upgrades have been carried out all in readiness for the ultimate Merge upgrade. It started with the launch of the Beacon Chain which revived the hopes of a blockchain that could offer near-instant transactions.

After the final testnet Goerli went live successfully Ethereum developers anticipated that the Merge Upgrade would take place on September 15 going by the hashrate and the targeted total difficulty.

Target total difficulty for the Merge to take place

After several Ethereum developers hinted at September 15 as the date for the Ethereum Merge, Vitalik Buteirn came out to specify that the exact date would depend on the ETH hashrate since the total difficulty to be achieved had already been set at 58,75,00,00,00,00,00,00,00,00,000.

It was with respect to the set total difficulty and the average hashrate of 872.2 THs at the time that the date of September 15 was arrived at.

The total difficulty, however, currently stands at around 57,70,49,02,01,07,48,20,74,40,547 with the preparations for the Merge being 98.21% complete.

If the current hashrate is maintained and the Bellatrix update scheduled for September 06 2022 takes place without a hitch, then the Merge may be triggered well before the announced date of September 15.

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As the upcoming Ethereum merge continues to cause excitement within the crypto space, Ethereum Classic (ETC), a sister of Ethereum, has seen an 83% increase in hashrate since June according to Gayatri Dhumal, a researcher at BitwiseInvest.

As the hashrate of Ethereum Classic surges, Ethereum on the other hand has dipped by 11%.

Why is ETC hashrate surging?

Ethereum Classic has been the largest beneficiary of the upcoming Ethereum merge that has caused a massive exodus of Ethereum miners as the mining of Ethereum comes to a halt with the Ethereum merge upgrade.

Ethereum miners are opting out and the closest blockchain is Ethereum Classic.

While there are some efforts to launch new hard forks of Ethereum after the Merge, a majority of blockchain protocols have committed to support Ethereum after the Merge upgrade by insisting that they shall not support any proof-of-work (PoW) forks of Ethereum afterwards.

As a result, Ethereum Classic remains the only Ethereum hard fork that legitimately exists.

Earlier this month, Vitalik Buterin, the Ethereum co-founder, said that “pretty much everyone” was supportive of the Ethereum Merge that will move it from a PoW to a proof-of-stake (PoS) blockchain.

Generally, Ethereum Classic is expected to win big after the merge as it will be left as the only Ethereum fork to enjoy the original Ethereum PoW mechanism.

Ethereum Classic is a hard fork of Ethereum. It forked back in 2016 following the infamous DAO attack that remains one of the most significant hacking in the history of cryptocurrencies. Ethereum Classic was created by those who wanted to preserve the original Ethereum chain.

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Ethermine, the largest Ethereum mining pool, has announced the launch of a new ETH staking service that offers members a chance to collectively stake their ETH and earn 4.43% interest annually. The new staking service allows users to earn additional income on their ETH deposits.

Members will require as little as 0.1 ETH (which is just about $159) to participate in the new ETH staking service. The staking service will, however, not be available to US miners.

The new ETH staking service comes ahead of the much-anticipated Ethereum Merge, which is expected to happen on September 15.

Ethermine’s new ETH staking pool

At press time, 393 Ether (worth about $626,000) had been invested in the new ETH staking pool.

Such staking pools offer competitive interest rates and lower barriers of entry compared to solo staking pools that require node operators to stake at least 32 ETH.

The switch to offer staking services is a huge step for Ethermine, which is largely known for operating a multi-currency mining pool that allows members to mine Ethereum (ETH), Ethereum Classic (ETC), Zcash, Ravecoin (RVN), Ergo (ERGO), and Beam (BEAM).

It is important to note that once the highly anticipated Ethereum merge upgrade takes place, Ethereum mining will no longer be required as previously required for the proof-of-work consensus mechanism that Ethereum currently use. After the merge, Ethereum will move to the Proof-of-Stake (PoS) consensus mechanism that is geared towards staking rather than mining.

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Crypto exchange Coinbase has launched Ethereum liquid staking token ahead of Ethereum’s migration to a proof of stake protocol.

Coinbase, one of the leading crypto exchanges in the world, announced via a tweet on Wednesday, August 24th, that it has launched its liquid staking token called, Coinbase Wrapped Staked ETH (cbETH).

This latest development comes a few weeks before the Ethereum Merge, an event that will see the Ethereum blockchain migrate to a proof of stake mechanism from its current proof of work.

Coinbase wrote that the Coinbase Wrapped Staked ETH (cbETH) is a utility token that represents ETH2, which is ETH staked through Coinbase. cbETH can be sold or sent off-platform, while ETH2 will remain locked up until a future protocol upgrade.

The crypto exchange added that the price of cbETH is NOT meant to track the price of ETH 1:1. cbETH represents staked ETH plus all of its accrued staking interest, starting from when cbETH’s conversion rate and balance were initialised.

Coinbase added that holders of ETH2 (staked ETH on Coinbase) could “wrap” their ETH2 and receive cbETH through its website. Wrapping functionality will be rolled out to eligible users progressively throughout the day, Coinbase said.

Liquid staking enables investors to generate extra income on top of standard rewards they make for staking or locking coins in a network.

With liquid staking, the locked staked coins are “wrapped” into transferable tokens, representing ownership of the underlying staked assets and any rewards earned.

The tokens generated from liquid staking are fully transferable and can be unwrapped to redeem the underlying staked assets. 

Coinbase intends to generate massive adoption of its cbETH token, which will have several uses following Ethereum’s migration. In its whitepaper, Coinbase said;

“Our hope is that cbETH will achieve robust adoption for trade, transfer, and use in DeFi [decentralized finance] applications. With cbETH, Coinbase aims to contribute to the broader crypto ecosystem through creating high-utility wrapped tokens and open sourcing smart contracts.”

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