Ethereum (ETH), the cryptocurrency with the second largest market capitalization following Bitcoin, raises the possibility of raising the price of related virtual assets ahead of the completion of the ‘Merge’ upgrade that converts the blockchain system.
According to CoinDesk, a US cryptocurrency media outlet, on the 10th, Ethereum rose regarding 60% from the beginning of July, just before expectations for a merge upgrade began to rise in earnest.
The upward curve of Ethereum Classic (ETC), which built a new block chain (hard fork) by splitting from Ethereum in the past, is steeper. Ethereum Classic has recorded an increase of regarding 150% compared to the beginning of July.
In domestic cryptocurrency exchanges such as Upbit and Bithumb, Ethereum Classic beats the ‘biggest’ Bitcoin and Ethereum, and continues to dominate the list in recent trading volume. In Upbit, the prices of Ethereum and Ethereum Classic were in the 2.35 million won and 53,000 won range, respectively, as of 5:30 pm the previous day, recording a similar or higher rate of increase compared to the beginning of July.
The surge in Ethereum Classic is interpreted as a reaction to the merge upgrade, which changes Ethereum’s block reward method from Proof of Work (PoW) to Proof of Stake (PoS).
Investors who participated in 32 Ethereum staking (coin deposits) now automatically become network validators and are rewarded. seat is lost
At this time, the alternative coin that miners paid attention to is the PoW method Ethereum Classic. This is because they can be rewarded by maintaining the same system as Ethereum mining.
When miners flock, the difficulty of mining increases and the possibility that the price will rise increases. This expectation is pushing up the price of Ethereum Classic.
The strong movement to create a PoW-type coin ‘ETHW’ (tentative name) by hard forking the current Ethereum may act as a variable that puts the brakes on the dominance of Ethereum Classic.
Jeong Seok-moon, head of Corbit Research Center, said, “A hard fork can be conducted even in terms of sustaining the livelihood of existing Ethereum miners. If software for PoW hard fork is released, the possibility will increase.”
However, it is analyzed that even if the hard fork succeeds, investors will trust Ethereum Classic more than the newly born ETHW.
Lee Mi-sun, head of the research center at Bithumb Economic Research Institute, said, “The demand for miners for the two coins may diverge, but it remains to be seen whether the Ethereum Classic to be hard-forked will go beyond the trust of Ethereum Classic as it is new and lacks verification.”
Vitalik Buterin, the founder of Ethereum, also made an advocacy statement at the end of July, saying, “If you prefer the PoW method, you should consider a migration to Ethereum Classic. It’s a great chain.”
It is predicted that the price of Ethereum and related cryptocurrencies will continue to rise following the merge upgrade.
If this upgrade is successful, future upgrades such as ‘Surge’, ‘Verge’, and ‘Purge’ will also gain momentum to increase TPS (transactions per second) and improve network congestion.
There is also an analysis that the merge upgrade is already working as a good thing, but it may not be fully reflected in the current price.
Lee Mi-sun, head of the center, said, “If you look at the trend of overseas futures exchanges, it seems that many investors expect the Ethereum price to rise to $2,000-3,000 at the end of September.” It doesn’t seem to be fully reflected in this.”
(Photo = Yonhap News)
