Experts and researchers are now predicting that Ethereum overtaking Bitcoin in the Blockchain Market is turning out to be accurate. The main reason behind this prediction is Ethereum is moving towards Ethereum 2.0. It involves switching to a drastically less energy-consuming method of validating transactions known as Proof of Stake (PoS).

Ethereum is the first among other Blockchains to move from Proof of Work (PoW) to Proof of Stake (PoS). This could be a giant step for Ethereum but this will revolutionize Blockchain completely. In the beginning, it will reduce the global energy consumption required for mining.

Ethereum Overtaking Bitcoin Or Not?

Some experts and researchers are already recommending people who invested in Bitcoin to start selling them as soon as possible. Ethereum can revolutionize the complete Blockchain Industry with the change to Proof of Stake, which is expected to happen at the end of this month.

One of the other factors behind the leading Blockchains is the massive energy consumption involved. With “The Merge” happening with Ethereum’s switch, the energy costs will be down by 99.95%. It means that 10 million GPUs worldwide could be narrowed down to just a few thousand, resulting in a reduced energy crisis globally.

Indeed, Ethereum will be taking over Bitcoin if “The Merge” happens. With the cut in energy costs, this will result in Ethereum coming up front in the Blockchain Market due to the transaction costs going even cheaper than before.

Is Ethereum The Future of Blockchain?

Yes, it is more likely that the future will favor Ethereum overtaking Bitcoin. Ethereum’s merge with Proof of Stake (PoS) could open up the Blockchain industry towards an inward investment from traditional finance, which remained quite cautious in the past due to the carbon footprint associated with Proof of Work (PoW).

In Ethereum 2.0, ether will become a deflationary cryptocurrency, with the annual issuance of the cryptocurrency being slashed down by almost 90%. Investors are already lining up many ether call options for a possible bull run on Ethereum if The Merge goes through. With only over a month left, many crypto analysts are predicting the changes to come just after The Merge.

Ethereum will completely revolutionize the Blockchain Industry if The Merge goes through without complications. Apart from resolving the Global Energy Crisis due to mining, it will also reduce the other transaction cost that Ethereum had to bear.

Can Ethereum Flip Bitcoin Over?

The flipping can occur due to various causes and ways. With a limited amount of Bitcoin, some of its value is derived from its rarity and can also serve as an inflation hedge.

Comparing it to cash processors like VISA, which can handle around 60,000 transactions per second. On the other hand, Bitcoin’s Blockchain can handle roughly seven transactions per second. So, Bitcoin is too reluctant to function as a suitable means of exchange. Thus resulting in forcing people to look for a faster and more efficient system.

Ethereum has made it quite feasible to develop and build new valuable products and services. As a means of exchange, these developments on the Ethereum Blockchain will need some ether coin. This will indirectly raise the price and demand of the cryptocurrency.

Ethereum Overtaking Bitcoin: Final Thoughts?

All experts and researchers have pointed toward a major increase in the prices of Ethereum by the end of this year. The projected growth of Ethereum should be seen shortly after The Merge is launched. Many critics still think it is to create hype in the Blockchain Market, but that’s entirely wrong.

Users and Investors are more likely to shift towards Ethereum than Bitcoin after Ethereum’s transition. Only time will tell us if this is true, but the stakes are pretty high. There is little wait left to guarantee full insurance of this significant evolution of the Blockchain Industry.

Ethereum switching to Proof of Stake (PoS)?

The NFT market tokens representing Digital Art, Music and Videos soared to a whopping price of $44 Billion last year. This increased attention to the Ethereum Blockchain, where most of the NFTs were bought and sold. Hence, Ethereum came up with the idea to change from Proof of Work to Proof of Stake.

Unlike a banking system, a Blockchain network doesn’t have a central gatekeeper to verify the transactions. Instead, Bitcoin and Ethereum, two of the largest cryptocurrencies, both rely on a mechanism called “Proof of Work (PoW)” to maintain the ledger of transactions.

What is Proof of Work (PoW)?

It is the algorithm that helps secure many cryptocurrencies like Bitcoin and Ethereum. The concept behind its creation was to control third parties like banks or states involved in the financial ecosystem. Participants maintained a shared ledger, which is why Blockchains like Bitcoin and Ethereum moved their systems entirely to PoW.

Even more specifically, PoW solves the “double-spending” problem. If, for instance, the users double-spend their coins, this will cause inflation in the overall supply, resulting in the devaluation of everyone else’s coins and making the currency worthless. Hence, the Blockchain networks shifted completely to PoW, making doubling digital currency very difficult.

What is Proof of Stake (PoS)?

The problem was quite clear for Ethereum developers regarding the limitations with PoW. So, they are almost in the final stages of building the new solution, “Ethereum 2.0”. This upgraded version of Ethereum will produce a faster, intensive mechanism called “Proof of Stake (PoS)”. It will not only maximize the speed and efficiency but also lower the existing fees.

In Proof of Stake, staking is similar to a proof of work’s mining. It’s the process through which a network participant gets to select the latest batch of transactions to the desired Blockchain and, in exchange, earn some crypto back. The details may vary, but PoS Blockchains generally deploy a network of “validators” who contribute or stake their personal crypto in exchange to get a chance to validate new transactions, update the Blockchain and earn themselves a reward.

How does Proof of Stake work?

Basically, in PoS, the algorithm selects a pool of validators based on the number of funds each validator has. If you’ve chosen and the committee of “attesters” accepts your block. Ethereum claims that the critical advantage behind switching from Proof of Work to Proof of Stake is the economic incentive to play by the rules. If a node picks up a bad block or transaction, the validators face “slashing”, which technically means that all their ether is “burned”.

Proponents have claimed that Proof of Stake is far more secure than Proof of Work. Attacking a PoW chain, you only need half the computing power in the network. Whereas, for PoS, you need to control more than half the coins of the system. It is pretty tricky to achieve this with PoW.

A Risky Move for Ethereum?

Moving the Blockchain network from Proof of Work to Proof of Stake comes with risks. Thousands and thousands of Smart Contracts operate entirely on the Ethereum chain, with billions of dollars of assets at stake.

Proof of Stake has still not been proven onto our existing Proof of Work platforms. Ethereum has been among the top Blockchain networks, and it will be difficult for them to transit from PoW to PoS. The vulnerabilities would surface once the new system is widely released.

Future of Ethereum?

With Ethereum’s transition to this new protocol, we are still unsure how it will affect the Blockchain market. If this plan for Ethereum succeeds, then this will increase the price of Ethereum to booming numbers in the Blockchain market.

However, Ethereum will be launching its “Ethereum 2.0” mid-next month. Only a few days left as Ethereum is working on the final touches of their Proof of Stake model. With the crypto market being uncanny, no one is still sure what the future of Ethereum holds after their new model implementations. Let’s hope it goes the right way, as it will completely revolutionize the Blockchain market.

Services

Careers

Digital Marketing Executive

Company