This coming September, the era of Ethereum “killers” might actually come to an end, as the world’s second-largest blockchain network is about to ship what is arguably its greatest upgrade since its inception after repeated delays. The Merge, which is set to make the layer-1 platform environmentally friendly, could silence many of its current critics.
And while this news is certainly exciting for multiple reasons, we are also concerned with the high number of misconceptions being permeated across web. To our surprise, these myths are actually being peddled by various crypto blogs and so-called “crypto education” platforms, who are either outrightly misleading the public, or are clueless about the upcoming upgrade themselves and unknowingly spreading their ignorance.
These false narratives have helped build hype on The Merge, which could have serious consequences in the market if not properly clarified. We’ve seen countless examples throughout crypto history where the market dumps hard when hype meets unrealized expectations: a gruesome combination.
With so much ‘at stake’, both literally and figuratively, we decided to compile the worst Merge misconceptions and bust them once and for all.
What Exactly is The Merge?
‘The Merge’ is Ethereum’s full-fledged transition into a proof-of-stake (PoS) consensus mechanism, which will utilize significantly less energy in its operation. It will be the literal merging of the network’s mainnet blockchain and its separate PoS layer called the Beacon Chain. Developers have also assured that the mainnet’s entire transaction history since 2015 would remain intact and secure.
5 Common Misconceptions on the Merge
Let’s look at five of the biggest myths surrounding the upgrade and analyze why they are wrong in the first place.
The Merge Will Make Ethereum Transactions Fast and Cheap
The Truth: Transaction speed and cost after the Merge will be almost identical to Ethereum’s current mainnet.
Scalability is perhaps the most serious myth around the Merge.
Yes, there will be slight speed improvements in block inclusions and transaction finalizations, but users shouldn’t expect a significant difference. To show you how modest this speed increase is, the network’s proof-of-work (PoW) system can create a new block at an average of 13.3 seconds (which sometimes takes a few more seconds), while its Beacon Chain can finish this at precisely 12 seconds.
In other words, while there is indeed an increase in speed after the Merge, it will barely be noticeable from a user’s point of view.
Another misconception that needs to be clarified is the myth of “reduced gas fees,” so let’s make it short and sweet: Ethereum gas fees won’t drop right after The Merge and will likely remain the same for a while (several months to two years estimate). Other blogs might give a more optimistic prediction, but we have patiently followed Ethereum’s development for years and so far; delays are more common than most people think.
When people talk about scalability in relation to the Merge, they’re actually thinking about a future upgrade called “The Surge”, which would allow the platform to scale to Visa-level capacity. And this can be achieved by implementing “sharding,” a feature it plans to assemble through a series of gradual improvements.
Sharding (or Shard Chains) basically divides an enormous task into smaller pieces and spreads its load. This process makes each node’s tasks lighter, which can increase their transaction speed and lower their power demand, benefits that can potentially boost Ethereum’s speed and reduce its congestion.
Furthermore, sharding can potentially lower hardware specifications for each node, allowing laptop and mobile users to finally verify blocks and transaction data on their own. While these portable devices can already run nodes today, keeping them running 24/7 can significantly shorten their lifespans due to heat, which makes them unsustainable. The potential spike of validators it may generate can strengthen the network’s decentralization level.
A New Ethereum Token Will Emerge
The Truth: Ethereum developer Tim Beiko himself clarified that there would be no new token on the Merge upgrade, in other words, ETH will remain as the blockchain’s cryptocurrency.
The “new token” myth is actually peddled mostly by scammers to net victims across the web3 space. Their M.O. usually involves enticing investors and holders to swap their ETH tokens for the new “Eth.2.0” crypto to prepare for the upcoming upgrade. Partly the reason why ETH developers have phased out the terms “Eth1” and “Eth2” was to significantly reduce Merge-related scams.
In fact, be mindful of any individual in the crypto space who still uses these terms as they’re either choosing to use outdated terms or don’t even know they’re outdated.
If you see or receive any offers on “Eth2” or related transactions, you may report their ETH address on Etherscan.com. You may also report the incident to the Federal Trade Commission (FTC), Common Futures Trading Commission (CFTC), or Securities and Exchange Commission (SEC).
Everyone Can Withdraw Staked ETH After the Merge
The Truth: Users still won’t be able to withdraw their staked ETH on the Beacon Chain once the Merge rolls out.
While the Ethereum community might be raring to withdraw some or all of their ETH after The Merge, developers have already clarified that it won’t be possible for now. Staked Ether will remain locked for possibly one year after launch.
Users can eventually withdraw their assets, but they’ll have to wait for the network’s ”Shanghai Upgrade” to be able to do this.
But earning opportunities will be present after the Merge as validators can immediately earn from staking rewards.
The Network Will Go Down After the Merge
The Truth: The transition was designed from the ground up to prevent network shutdown.
This isn’t Solana.
The Ethereum mainnet never had a single outage in its 7-year history, and its PoS transition aims to continue this sterling record. Moreover, the developers have vowed that any pause or even brief shutdown won’t be needed when the transition occurs, which, given the blockchain’s massive size, is a technical feat. While it is yet to see if the transition can really execute well, the network’s downtime-proof track record may already speak for itself.
You Need at Least 32 ETH to Stake
The Truth: You can stake less than 32 ETH if you don’t run your own validator node.
You need to have at least 32 ETH to stake solo, which involves running validators nodes and earning rewards, tips, and MEV. But if you have less than 32 Ether, you can still stake via staking pools like Rocket Pool, without running your own nodes at all.
What Will The Merge Do Then?
The Merge will be Ethereum’s biggest evolution yet and would represent its complete transition to the more environment-friendly PoS consensus mechanism. The upcoming upgrade is expected to slash the blockchain’s energy consumption by 99.95%, which could finally silence the most passionate environmental critics. Furthermore, once the Merge goes live, Ethereum’s mainnet will serve as the blockchain’s execution layer while the Beacon Chain will work as the consensus layer, resulting in seamless cooperation and better services.
While the Merge may not meet all the high expectations of the community (for now), it could save the network from its soiled reputation brought about by the environmental impacts of its mainnet’s operations. The carbon-blasting narrative Ethereum has endured these past couple of years has massively affected the non-fungible token (NFT) space, which was unfairly generalized as digital assets that are as harmful to the environment. Even NFTs from other blockchains with negligible carbon footprints have also been afflicted by the “bad publicity” purported by environmentalists who have demonized NFTs due to Ethereum’s high energy usage.
But thanks to this transition, the blockchain giant can finally redeem its itself, and hopefully improve the public’s perception of NFTs in general.
The Merge will also serve as the foundation for Ethereum’s series of future scaling solutions, including sharding, which wasn’t possible with the existing PoW system. But despite its long list of features, potential, and promises, its real strength and limitations will be tested on the ground, in the midst of million+ demanding users and a long queue of competitors wanting a slice of its market share.
Only time will tell if this promising blockchain will surge or submerge in the long run.
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