The entire digital currency market is quite excited about the current Ethereum upgrade. It is expected to have a positive impact on the investors as it is predicted to bring in a lot of transparency in respect to transaction fees on the network, according to experts. Let us have a look at Ethereum 2.0 news.
If you are a digital currency investor then you would have received a message recently from your trading platform that it has paused withdrawals and deposits for Ether. There was a restoration of these facilities by the exchange, late on Friday. The reason was a major Ethereum upgrade known as “The London Upgrade” or “EIP 1559” was being inserted into the Ethereum network.
According to experts, this upgrade is going to boost Ethereum prices.
“The entire crypto industry is quite excited about the latest Ethereum network upgrade. It will have a positive impact on investors as it is expected to bring in a lot of transparency in terms of transaction fees on the network.”
What Is This Ethereum Upgrade?
“The London Upgrade” Ethereum 2.0 staking upgrade refers to a set of upgrades that are interconnected and which is expected to make the Ethereum network more secure, more scalable, and more sustainable. According to Sathvik Vishwanath, the founder of a renowned crypto exchange,
“The Ethereum upgrade is popularly known as ‘London Hard Fork’. The major change we are going to see in this is about how the transaction fee collected by the computers for processing the transaction is handled and distributed. This upgrade will mandate a part of the fee to be destroyed.”
In other words, only a portion of the actual fee that is charged for the processing of a transaction would reach the person who is offering his power of processing.
Satvik further added that,
“Such destruction of cryptocurrency is possible by sending them to a null address and such payments can never be reversed or recovered or moved to another account. This is interesting because, over time, this would reduce the ether in circulation, which could push its price higher.”
Impact Of Ethereum Upgrade On Investors
As per the crypto experts, this upgrade is expected to raise the price of Ether in the medium to long run. This is in turn expected to strengthen the sentiments of the investors around the second biggest digital currency of the world. According to Shivam Thakral, chief executive officer, BuyUcoin,
“It will be exciting to see the bitcoin vs ether phase after the upgrade, as there are already some flipping conversations going on between ether and bitcoin in terms of market capitalization. There is a huge gap in the value between the two, but ether is the only strong competitor of bitcoin in the crypto world. However, it is important to note that Ethereum is already ahead of bitcoin on various other factors.”
While the best known case for Bitcoin is the store of value, in the case of Ethereum there are several real world scenarios such as smart contracts and decentralized finance.
The first easy to use and well structured for scaling of Ethereum and the development of infrastructure is Polygon. It aims to solve the pain points that are connected with blockchain such as slow speed, and high gas fees without making any compromise on security.
Importance Of EIP 1559 For Polygons
EIP 1559 is crucial for the Ethereum network, as it decreases the high Gas price which also helps Polygons and any other “layer 2 solution providers.”
It is also present in the advanced condition of implementing EIP 1559 as it wishes to keep the startup as near to the Ethereum network as possible. According to the co-founder of Polygon, Sandeep Nailwal,
“It will be overall helpful for the Polygon ecosystem as due to a lot of adoption, we are also seeing Gas fees also going up.”
What Does Vitalik Buterin Have To Say About This Upgrade?
The prevailing decrease in the Ether supply is the reason for the ETH 2.0 price rise with this digital currency up by 18% since the London fork upgrade began. According to Buterin,
“1599 is definitely the most important part of London, which is proof that the ethereum ecosystem is able to make significant changes.”
The Ethereum blockchain still has a massive alteration ahead, most probably in transition to a system of proof of stake from a proof of work system. That alteration which is predicted to run into effect in the Ethereum 2.0 network overhaul, will decrease the emission of carbon that is related to the mining of ETH by 99%.
The ETH 2.0 launch date was on Wednesday, August 4 with EIP 1559 upgrade.
With a sudden Ethereum upgrade, the crypto enthusiasts expect that the Ethereum price will see an increase. This upgrade is said to bring a lot of alteration in the Proof of Stake working. The founder of the Ethereum network has asserted that more big alterations are yet to come that will decrease the carbon emission caused due to mining.
Frequently Asked Questions On Ethereum Upgrade
According to analysts ether is expected to increase as the blockchain transitions to Ethereum 2.0 and as developers offer out the latest DeFi applications. However, the prices of digital currency can fluctuate badly, and the price could still decrease back again even if the Ethereum prediction looks bullish for 2021.
While it has already been in the research and development since 2014, Ethereum 2.0 has actually been creating some headway. When this occurs, mining Ethereum coins will officially stop and staking will become the primary way to formulate new coins. This is supposed to take place in 2021 but may not take place until 2022.
Ethereum has the power for extraordinary gains, but it’s also a very risky and volatile investment. Before you invest in this digital currency, ensure you’ve done your research completely and know what you’re investing into. Digital currencies could be life-changing investments, but it’s not right for everyone.
ETH 2.0 continues to be completely usable on the Ethereum 1.0 chain. At some point, the ETH 1.0 chain will become a part of Ethereum 2.0, and your Ether will prevail to operate just as it does now, with no requirement of action on your end.
As per the current long-term forecast, the price of Ethereum is expected to hit $5,000 by the end of 2022 and then hit $10,000 by the middle of 2026.