According to a new clarification from the Ethereum Foundation on Wednesday, the network’s transitional Proof-of-Stake upgrade – called “Merge” – will not reduce gas fees. On this topic, the Ethereum Foundation wrote:
“Gas charges are a result of network demand versus network capacity. The Merger does not use proof-of-work, moving to proof-of-stake for consensus, but does not significantly change settings that directly affect network capacity or throughput. »
The Merger, which aims to combine Ethereum’s current mainnet execution layer with its new proof-of-stake consensus layer, the Beacon Chain, will eliminate the need for energy-intensive mining. It is expected to launch in the third or last quarter of 2022. While many investors and traders bought Ether in anticipation of the Merge upgrade, it seems that some did so by mistake thinking that the network capacity will increase when it arrives the upgrade in place.
First of all, anyone is allowed to sync their self-verifying copy of Ethereum or run a node, without any need to put initial funds in Ether. As for staking, Ether cannot be withdrawn before the next update in Shanghai. However, liquid ETH rewards in the form of fee tips will be available immediately. Withdrawals from collectors, once online, will be rate limited to avoid a possible liquidity crisis.
Transactions will also not be significantly faster after the Merger. However, after the Merger, APR returns on the network would need to increase by 50% from now on to attract capital. Client developers are currently working on a tentative deadline of September 19th to complete the Merge, which is designed to cause no downtime during the transition.
