The date is fixed
The long-awaited switch from Proof of Work (PoW) to Proof of Stake (PoS) is finally set to take place: After several postponements of the date and a successful test run in early August, the long-awaited merge is finally set to take place on September 15. Only one day after the successful test run, the date for the final merge was set. With the final upgrade called Paris, the current proof-of-work blockchain (PoW) will finally become a PoS blockchain. Investors reacted positively, causing the ETH price to rally. Ethereum has also gained in sympathy, because in view of constantly rising energy prices, the high energy demand for mining is a thorn in the side of many, which dulls the desire for investments. PoS can of course clearly score points here with its over 99 percent lower energy consumption. However, the merge will also make new functions available on the blockchain, which will probably ensure a further increase in attractiveness.
The operational implementation is still unclear, a hard fork of the Ethereum blockchain into a PoS and a PoW variant is conceivable. That’s where it worked in 2017 when Bitcoin was forked into Bitcoin Cash. In this case, Ether coins under the existing token ETH would be the new version and, in addition, ETHPOW coins in the corresponding amount would go into investors’ wallets. In this case, the sale of the new tokens would definitely be an interesting source of income. According to “BTC-ECHO”, however, this would only be possible if the Ether coins are stored in a non-custodial wallet during the merge. In addition, various updates are expected to strengthen the network after the successful merge.
The liquid staking industry could benefit as well, according to BTC Echo: They allow users to stake Ethereum without their own node. Thus, one could deposit ETH into a DeFi protocol and receive tokens from the corresponding provider in exchange at a ratio of 1:1. With this comes the entitlement to staked tokens and one receives automatic rewards. Liquid Staking companies retain a portion of these rewards – after the merge, it can be assumed that the profit potential for investors will increase.
But what if you are skeptical? There are enough risks that could lead to failure. This is where hedging can pay off: Establishing or holding a long position on ETH coins and in the same breath taking a short position on Ethereum futures. In this case, you are on the winning side both when prices are rising and falling. Alternatively, it is worth betting on another horse: Stablecoins. And if the ETH price falls after the merge, one can buy the dip and then hodln to profit from the long-term potential of the switch, which is undoubtedly given. Because the PoS variant is simply too promising for failure.