Robert Steinadler, a year ago
The Ropsten testnet will deliver interesting insights into the Merge. Starting next week, the testnet will switch to proof of stake. The Merge had been postponed just a few weeks ago and still, Ethereum is moving closer to a design that is supposed to be superior in scalability, security, and environmental impact.
What can we expect from the start on the Ropsten testnet and how will the Merge change Ethereum and the market?
Ethereum is working on the transition to proof of stake for quite a long time. The original idea was formulated from the very beginning but other things were more concerning and needed to be addressed first. Time and time again the so-called difficulty bomb was postponed with a hard fork.
The merge is a culmination of a long development that started in December 2020, when the Ethereum beacon chain started and marked the beginning of what is going to become a new area. The Ropsten testnet only implemented the beacon chain two days ago and the Ethereum Foundation announced that further details on the launch will be released by Friday.
Ropsten is the oldest proof of work testnet and therefore it will be highly interesting how the Merge will perform in this environment. After the transition of Ropsten that is going to start on June 8th, two more testnets will follow before the mainnet release is started. Once the mainnet release is finished, the Ropsten testnet has served its purpose and will be deprecated.
Proof of stake will be exciting for many investors, especially in the retail segment of the market. It is believed that staking rewards are going to increase and that running a validator will create good revenue.
Such a validator requires 32 Ether and the maintenance of a server running the node. That doesn’t exclude retail investors because they can delegate their ETH to a validator and still be rewarded for their stake.
With proof of work, everyone without a lot of hardware and access to cheap electricity was excluded from participating in the value creation by taking an active part in the network’s consensus. With a bear market at the doorsteps creating cash flow from staking the second biggest cryptocurrency next to Bitcoin is indeed creating an interesting opportunity in a harsher market environment.
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