Institutional Interest Rises in Ethereum with Imminent Merger

Upgrading Ethereum is all the rage these days and is highly anticipated due to the scalability and security it promises. After several successful tests, people are hoping for a soft launch in September.

Ethereum 2.0 is expected to be more energy efficient and therefore a planet-friendly network that will allow for more transactions and increased security. Technically speaking, Ethereum is on the verge of becoming a proof-of-stake (PoS) blockchain and introducing shard chains in its later phases.

With the merger near, institutional investment soared. Big investors are focusing more and more on ETH day by day.

In the latest edition of the Weekly Digital Asset Fund Flow Report, CoinShares Head of Research James Butterfill said investor sentiment towards derivatives and ETH products is changing – a development that is mainly due to the ETH merger.

The “craze” for Ethereum

According to a report, many institutional investors are making preferential investments in Ethereum products and derivatives.

Investors believe that upgrading the second largest cryptocurrency in the world would have an extremely profitable and positive impact.

With institutional investors turning bullish, a report indicated that Ethereum saw more inflows which amount to around $16 million. This led to a continuous pattern of inflows for seven weeks, racking up $159 million.

Butterfill mentioned that the shift in investor sentiment towards ETH shows more clarity with the merger expected to occur.

The move from Proof of Work (PoW) to Proof of Stake (PoS) seems to be driving the much needed transition for Ethereum. In its previous model, the Ethereum blockchain worked with a PoW mechanism to validate the transaction and the security of its network. The PoW mechanism uses more energy or electricity because it depends on mining, which is a huge disadvantage.

Not an easy trip

Ethereum supporters are having a joyous season with the launch soon approaching.

However, crypto enthusiasts will remember that this merger was delayed several times, and for several months. There have been multiple roadmap changes, ambiguous terminology and also opposition to it.

Vitalik Buterin, the founder of Ethereum, has repeatedly declared all possible hard forks in the transition. Even with the hard forks, ETH continued to receive support. Tron founder Justin Sun, for example, has pledged to list ETH and ETHw tokens on his Poloniex exchange. BitMEX also came forward, showing its support for one of the ETHPoW forks.

The transition, however, is a great opportunity for any PoW blockchain that may wish to change in the future. The merger will include linking the Ethereum mainnet and Ethereum 2.0 beacon chain for a full transition to PoS.

A major benefit of the change is a reduction in current carbon emissions being produced by almost 99%. This would be a good way to deal with the disadvantages of Ethereum as a PoW network.

When is ETH2 launching?

As for the Ethereum 2.0 release, the next phase is expected to launch in September.

But, how long exactly should we wait for ETH2 now?

With Ethereum moving slowly, the next step is the Ethereum merger date. According to the latest schedule, the Ethereum merger will take place on September 15, 2022 or September 16, 2022. In this merger, the existing mainnet will be merged with the Beacon chain of ETH 2.0, allowing for one hundred percent staking. Following the merger, Ethereum Shard Chains will be launched in 2023 to increase blockchain capacity.

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Valerie J. Wallis