Ethereum researcher Vivek Raman is confident that the upcoming transition of Ethereum (ETH) to a proof-of-stake system will allow it to take the place of Bitcoin (BTC) as the most prominent cryptocurrency.
“Ethereum, at least economically, and because of the supply shock, has the opportunity to compete with Bitcoin,” Raman said in an exclusive interview with Cointelegraph.
The Merger, a much-anticipated update that will complete Ethereum’s transition from a proof-of-work to a proof-of-work system, is set to happen in September. In addition, the Merger will change Ethereum’s monetary policy, make the network more environmentally sustainable, and reduce the total supply of ETH by 90%.
“After the Merger, Ethereum will have lower inflation than Bitcoin. Especially with fee burns, Ethereum will be deflationary and Bitcoin will always be inflationary. Although, with each halving, the rate of inflation decreases,” said Raman.
While Bitcoin will retain its function as digital gold, according to Raman, Ethereum will still have “larger adoption space” as the cornerstone of the decentralized financial economy (DeFi).
The Merge will not reduce Ethereum’s high transaction fees, which remain the main obstacle to Ethereum scaling. This is not a problem, according to Raman, as Ethereum will rely on Tier 2 scaling solutions to support most user activity.
“Users have to learn that all their activities have to take place on Layer 2, and then Layer 2 will use Ethereum as the basis of Layer 1 for settlement and security and decentralization. »
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