The cryptocurrency industry is becoming increasingly divided on the topic of the most significant organizational change in the history of cryptocurrency, which will occur when Ethereum switches from a Proof-of-Work blockchain to a Proof-of-Stake blockchain in a little over a month. Some supporters of Ethereum, particularly miners, are opposed to the event, despite the fact that there is no question that the merge would dramatically cut expenses and give rise to the first large-scale demand for assets in the history of cryptocurrencies.
Chandler Guo, a prominent Ethereum miner who participated in the 2016 fork that resulted in the creation of Ethereum and Ethereum Classic, has been one of the leading voices in favor of forking Ethereum to produce an EthPoW network. This would enable miners to ignore the merge update and continue mining.
Earlier this week, Guo stated in an interview that the implementation of PoS on Ethereum would be disastrous for the lifestyles of miners. “Many miners would be forced to close their operations,” Guo said, adding that it could also be difficult to repurpose mining hardware to mine other PoW coins. “Many miners would have to shut down their enterprises,” Guo said. The commentator continued by saying that his idea was rapidly gaining support from Ethereum miners and that those supporting it hoped to split the network within the first week of September.
A number of fans believe that when PoS is implemented, the Ethereum network will become progressively controlled. People on Twitter, such as user “ElonVerse,” fear that the situation would be considerably worse after the merger as a result of the recent ban on Ethereum-based cryptocurrency mixer Tornado cash, which exposed just how much power the OFAC may have on crypto networks. ElonVerse stated in a tweet that more than 66 percent of the network’s beacon chain validators would comply with OFAC standards.
On the other hand, despite the fact that Vitalik, the founder of Ethereum, does not have a problem with Proof-of-Work, he has recently criticized those who are working toward the forking of Ethereum, referring to them as organizations that are “simply trying to make a quick buck.” Additionally, several institutional traders are in favor of Ether’s switch to PoS. JPMorgan stated earlier this week that it will be beneficial to exchanges, particularly those who provide staking services.
As the excitement surrounding the Pre-merge event appeared to die down, the price of Ethereum experienced a precipitous decline toward the end of the week. According to Arthur Hayes, co-founder of 100x Group, the sell-off is being caused by investment firms who are either attempting to reduce their current ether holdings “to be able to pick up the free chain-split tokens that will be minted” or investors who are hedging their ETH exposure “by selling futures contracts at prices higher than the current spot price.” Hayes, on the other hand, is of the opinion that “a successful merging will lead to purchasing pressure at the margin, thereby overturning the market makers’ futures stance.”
Ethereum’s price has dropped by more than 13% in less than six days after recovering impressively from June’s low and skyrocketing by more than 100% to reach $2030 over the past weekend. According to the statistics provided by CoinMarketCap, the price of Ether (ETH) was trading at $1,698 at the time of this writing. This represents a loss of around 4.80% in the last twenty-four hours.