Ether (ETH) price rises after ethereum completes final testnet consolidation

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Ether spiked to a two-month high after developers successfully completed it final costume rehearsal for a major upgrade slated to take place next month.

According to data from CoinMetrics, the world’s second-largest cryptocurrency hit a price above $1,927 at around 8:20 a.m. ET Thursday. That is the highest level since early June and is up 13% in the past 24 hours.

On Wednesday, ethereum ran the final test of the “merge,” a milestone that is expected to make it faster and more energy efficient. One of ethereum’s testnets, called Goerli, simulated a process identical to what the mainnet will run in September. The testnet allows developers to experiment and make the necessary adjustments. required before updates launch on the main blockchain.

The merger will see ether’s underlying blockchain transition from a proof-of-work system to a more efficient model known as proof-of-stake. Proof-of-work consensus mechanisms depend on cryptocurrency miners to verify transactions. Proof-of-stake networks, on the other hand, require validators to hold a certain number of tokens in order to participate, making them much less energy-intensive. The event, which has been delayed several times, is now scheduled to take place on September 19.

Once completed, the upgrade is expected to speed up transactions on the ethereum network and make it more energy efficient, with proponents hoping it will address criticism of the ethereum network. environmental impact of cryptocurrencies. That has led some investors to bet ether might end up stealing bitcoin’s thunder. Bitcoin has lost some ground against other tokens in recent years, with its market dominance dropping below 40% from nearly 70% in early 2020.

For IT expert Kaj Burchardi, whether ethereum will ultimately consider bitcoin the king of crypto is “not much relevant” as the two are not directly in competition with each other.

Burchardi, managing director of BCG Platinion, the IT-focused division of Boston Consulting, said: “Why are you buying bitcoin, from a mindset perspective, and what you really want to do with that in terms of fundamentals? different version than when you use ethereum. Coporation, group.

“Ethereum … not a use case. It provides the ability to implement really good use cases like NFTs. [nonfungible tokens] and banking products on one platform. Bitcoin is a use case. “

Following the success of the consolidation test, ether led a broad rally among digital assets on Thursday, with the aggregate value of all cryptocurrencies increasing by more than $70 billion in the past week. a day to 1.2 trillion dollars. Bitcoin rose 6% at $24,507, hitting a near two-week high, while Binance’s BNB the token is 3% higher at $330.

However, investors got bored with cryptocurrencies more generally after catastrophic collapse of $60 billion stablecoin, sent shock waves through the crypto market and helped trigger the collapse of investment firms Celsius, Three Arrows Capital, and Voyager Digital. The entire crypto market has shed nearly $2 trillion in value since peaking above $3 trillion in November.

– CNBC’s MacKenzie Sigalos contributed to this report

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