- Miners are selling their hash power in advance of the merge.
- Hash rate is a measure of the computational power used to mine a cryptocurrency.
- The price of ETH has been on a bull run lately but fell sharply today.
According to Ethereum`s founder, Vitalik Buterin, it Looks like the “hash rate will drop weeks before the merge due to miners rushing to sell ahead of everyone else” thesis has been proven completely false.
Miners are apparently selling their hash power in advance of the planned Ethereum hard fork, according to reports. The hash rate has been decreasing ahead of the scheduled September 15th merge. This implies that Ether’s price could fluctuate in the coming weeks. We’ll have to wait and see how things turn out.
Hash rate is the computational power used to mine a cryptocurrency. Assets such as Bitcoin, Ethereum Classic, and Ethereum (before merge) use the proof-of-work system which needs lots of energy and powerful computers to process transactions.
The high hash rate means that miners are getting paid more for their work and are thus able to reinvest in better equipment. A lower hash rate suggests that miners are not making as much money, which could lead to a decrease in investment.
Although the Merge is not anticipated to alter Ethereum transaction costs, further network upgrades, such as danksharding and proto-danksharding, may assist alleviate high network costs. However, these updates are not expected until 2022 at the earliest due to future network upgrades.
The Ethereum transaction speed will increase but is barely noticeable due to the merge. This is not a big deal for people who are buying and holding ETH. However, day traders and those looking to use Ethereum for its “smart contract” capabilities (such as decentralized exchanges) may want to take note.
On average, in the proof-of-work system, Ethereum blocks are issued every 13 or 14 seconds. With the new changes, those using proof-of-stake will receive their block 12 seconds apart on a regular interval.
This is a very small improvement but it is something to keep an eye on. The price of ETH has been on a bull run lately but fell sharply today after a report that miners were selling their hash power in advance of the planned merge.
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