DappRadar Warns of Slow Transactions and Plunging Stablecoins Before Ethereum Merge Launch
Ethereum’s upcoming Unified upgrade is a highly anticipated event awaited by the blockchain community around the world. Ahead of the release, a report by DappRadar stated that stablecoins and transactions supported on the Ethereum blockchain could face some difficulties. Ethereum is moving from an energy-efficient Proof-of-Work (PoW) mining model to an energy-efficient Proof-of-Stake (PoS) mining model. This update to the blockchain, called Consolidation, is scheduled to release in mid-September and is considered the biggest update to the blockchain to date.
Ethereum supporting an ecosystem of decentralized token trading, lending and farming projects that together process billions of dollars worth of cryptocurrency daily. When the Ethereum blockchain moves to Upgrade Mergethe transition can cause disruption on Decentralized Finance (DeFi) protocols.
The largest number of Ethereum blockchains total value locked in decentralized exchanges and lending protocols, according to CoinDCX.
In it report, DappRadar notes that MakerDAO (MKR) recently stated in a Twitter thread, that Merge could do more harm than good. MKR is the creator of the DAI stablecoin DAI. As part of its analysis, MKR has also predicted that the Consolidation release could cause selling pressure on existing blockchains on PoW.
Recently, there has been increasing focus on post-consolidation PoW Ethereum forks.
If those forks happen, what are the potential risks that Maker faces?
:topic:
first /
– Producer (@MakerDAO) August 5, 2022
Cryptocurrency investment firm Grayscale also recently expressed concern about the effects Consolidation could have on the market. The Cryptocurrency investment The company believes that the Consolidation could lead to a fork that could have unexpected and unfavorable results, the report noted.
2. First, it is important to note that motivations differ. The 2016 Ethereum fork was fueled by a crisis, while the upcoming Proof of Stake (PoS) migration was driven by an ambitious, proactive technology update.
Let’s look a little deeper.
– Grayscale (@Grayscale) August 16, 2022
While all of these predictions will be tested in due time, Consolidation has been labeled as one of the most significant milestones in the blockchain industry.
Earlier this month, major stablecoin Tether and Circle Pay, issuer of USD Coin Extended support for Merge.
While Tether has decided to start working on agreements to support Consolidation in line with its release schedule, Circle Pay has said that once Merge is released, it will only use that version of Ethereum. for USD Coin operations.
The Unified upgrade is expected to reduce Ethereum’s power consumption by 99.95%, its developers announced in a statement. blog post last year.
Meanwhile, bug bounty Payments for Ethereum can now go up to $1 million (approximately Rs. 8 crore), the blockchain’s developers said in a recent update.