Bankless: Don't ignore Ethereum's merger, "triple halving" or will end the bear market?
Original title: "Don't sleep on the merge [LITE]"
Original compilation: 0x711, BlockBeats
Author: David Hoffman
Original compilation: 0x711, BlockBeats
Why did the merger happen in June and what does it mean for ETH?
Three months until the merger
SuperPhiz is an active member of the EthStaker and Rocketpool communities, and pays more attention to the minutiae of the merge than anyone I know (besides the developers themselves).
On the r/EthStaker subreddit, SuperPhiz detailed 5 indicators that the merger will happen in June.
difficulty bombdifficulty bomb” will arrive in mid-June.
merge
3、main networkmergepreparation listfinish quickly.
Kiln Testnet
5、Kiln Testnettest mergetest merge。
Barring some major unforeseen issues, we see a growing likelihood of a merger in June.
June.
That means only 3 months left.
The importance of this blockchain network upgrade is unprecedented, and it may be difficult for latecomers to surpass it. Longtime Bankless readers and listeners certainly knowThe Importance of Consolidation and Its Coming. But I'm not sure the rest of the crypto industry knows, let alone the world outside of crypto.
If Ethereum achieves its goal of becoming the global settlement layer of the Metaverse, the Ethereum merger will be one of the most historic events of our time.
For most people, it doesn't even require registration.
Like many of us who are older remember what it was like to log on to the Internet via dial-up.
Our kids will think it's crazy to transact on Ethereum with PoW consensus.
One of my hobbies is daydreaming: "If $ETH is priced at $x and staking yields x%, how much annual income will I make?" Luckily, you canuse this to calculate,We are hereteach you how to do。
Most people think ETH will go to $10k or even $20k...
$10k is bearish.
$20k is FUD.
This is so you canReminder with higher expectations。
Merged ETH
Currently there are10.5 million ETH staked on the beacon chainAmong them, the rate of return calculated based on the ETH currency standard reached a considerable 4.8%.
Once these 10.5 million ETH are merged with the PoW Ethereum chain, the yield will rise from 4.8% to ~10-15%. Returns increased by 2-3 times:
1. The incentive to hold ETH is increased by 2-3 times.
2. The incentive to pledge ETH has increased by 2-3 times.
At the same time, new ETH issuance has decreased by 90%.
Currently, retail PoW miners earn 12,000 ETH per day and are forced to sell a significant portion of it to pay for electricity.
After the merger, PoS validators will earn 1,280 ETH per day, and there is no reason to sell ETH to cover operating costs.
Our daily issuance has decreased from 12,000 to 1,280 ETH, and the daily sell pressure has dropped from thousands of ETH to 0.
How much ETH will be staked due to increased yield? Now that a lot of regular selling pressure is about to dry up, where will ETH come from?
What price did it turn out to be?
These answers will appear in approximately 3 months.
Triple Halving Ends Bear Market
A common belief among Bitcoin believers is that the Bitcoin halving is what drives cycles in the crypto market. Every 4 years, we have a bull market, and the bull market starts with Bitcoin halving. The reduction in Bitcoin issuance reduces the amount of new supply flowing into the secondary market, and as the remaining liquid supply of Bitcoin in the secondary market dries up, a bull market gradually emerges.
If the Bitcoin halving is indeed the cause of the crypto market cycle, then the implications of the Ethereum merger would be enormous.
1. The Bitcoin halving reduces the new Bitcoin supply by 50%.
2. Ethereum merger reduces new ETH supply by 90%.
The merger has been dubbed the "triple halving" because Bitcoin needs to go through three halvings to produce a supply reduction of the same size.
It will take Bitcoin 12 years to do what Ethereum will do in the next 3 months.
If you believed in the idea that the Bitcoin halving would spark a bull run, imagine what would happen with a triple halving.
The last Bitcoin halving was in May 2020, when each Bitcoin block reward went from 12.5 BTC per block to 6.25 BTC per block. At $8,000 per bitcoin, the halving removes $3.6 million of daily selling pressure on bitcoin, making it easier for the price to rise.
Ethereum currently produces about 12,000 ETH per day, or about $30 million in security costs per day. After the merger of Ethereum, the daily output was reduced by 10,720 ETH, and the selling pressure of the daily output of 1,280 ETH was also eliminated. Since stakers do not need to consume electricity, they do not have to sell their ETH proceeds.
If removing the $3.6M daily BTC selling pressure was enough to trigger a bull run, what would happen if removing the $27M-$30M daily ETH selling pressure?
My weekly roundup for the last week, which surprised the audience by expressing pessimism about the crypto market for the first time.
For me, commodity markets, geopolitical risk, inflation, nuclear war, and the disappearance of all the upward momentum in crypto in 2021 are all bearish reasons.
I expect the crypto market to develop in a way that completely ignores the consolidated fundamentals, i.e. a bear market will suppress all price performance, no matter how bullish an individual asset may be.
That means the merger hasn't been priced in yet.
They don't understand its importance and don't see it coming.
But you heard it here. So when ETH starts to set a new ATH after the merger, I'll repost the link to this post and say:
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