If the Merge is so Good, Why is Ethereum Still Struggling to Set the Bullish Pace?

Ethereum

EthereumHere’s What Complaints on Ethereum PoW Network on Day 1 Due to Data Error

Ethereum PoW, the version of the Ethereum blockchain that continues to use a proof-of-work (PoW) consensus mechanism, had a disappointing first day due to teething issues. Some Twitter users reported that they were unable to connect to the network using the information provided by the Ethereum PoW Twitter channel. In contrast, others reported difficulties connecting to the network’s web servers. The blockchain was created as a fork of the Ethereum network, which switched to a proof-of-stake (PoS) consensus mechanism on Thursday during the Merge event. The PoS network is now known as Ethereum. SmartBCH, a Bitcoin Cash scaling tool, pointed out in a tweet that the network issues were most likely caused by Ethereum PoW using the same Chain ID as a SmartBCH testnet. Several people confirmed the problem.

A Chain ID is a series of numbers used by the browser-based crypto wallet MetaMask to sign network transactions. Because users aren’t connected to the correct network due to an incorrect Chain ID, transactions fail, rendering the network unusable. Meanwhile, the price of ETHW, the native token of Ethereum PoW, has dropped in the last 24 hours, most likely as a result of users receiving the new tokens and immediately selling them on the open market. The tokens are available on several exchanges, including OKX. Before the Merge, the tokens were worth more than $42 and had dropped as much as 78% to $8.20 in early European hours Friday. When ETHW futures were released in the first week of September, they traded at more than $54.

After years of development and delay, the massive Ethereum overhaul known as the Merge has finally occurred, transferring the digital machinery at the heart of the second-largest cryptocurrency by market value to a vastly more energy-efficient system. It was no easy task to switch from one method of running a blockchain, known as proof-of-work, to another, known as proof-of-stake. “The metaphor I use is this idea of swapping out an engine from a running car,” said Justin Drake, a researcher at the non-profit Ethereum Foundation who spoke to CoinDesk before the Merge.

The potential payoff is enormous. Ethereum should now use 99.9% less energy. According to one estimate, Finland has abruptly shut down its power grid. Ethereum’s developers claim that the upgrade will make the network more secure and scalable, as it houses a $60 billion ecosystem of cryptocurrency exchanges, lending companies, non-fungible token (NFT) marketplaces, and other apps.