The network of the second most popular cryptocurrency, Ethereum, is approaching the transition to protocol 2.0. It will save the blockchain from the main problem of Ethereum – high commissions. What happens to the price after the update?
Talks about protocol 2.0 for Ethereum have been going on for a very long time. It is expected to allow the cryptocurrency blockchain to scale and make it more user-friendly.
The long-awaited update
The main point of the update is the transition of the network to Proof-of-Stake (PoS) consensus, which will become an alternative to the current Proof-of-Work (PoW). PoS works without miners - this is its main advantage. To maintain the network, video cards and electricity will no longer be required in such quantities. The operation of the network will be ensured by coin holders who will receive a reward for this.
An important milestone was London hard fork, which took place on August 5th. It became a landmark step in the transition of Ethereum to protocol 2.0, completely changing the mechanism for calculating commissions for transactions - part of the commissions is now is burned at an average speed of 2.3 tokens per minute. This innovation reduces cryptocurrency inflation by destroying tokens.
What awaits the price of Ethereum?
The prospects for the Ethereum network to switch to protocol 2.0 have a positive impact on the rate. Already now the cryptocurrency is trading above the $3,500 mark, but once it started at just $0.3.
Ethereum price dynamics since August 2021
Source: app.stormgain.com
Back in January 2021, investors did not rule out that the Ethereum price could reach $10,000. Moreover, much more optimistic estimates are now heard on the market - $20,000–$40,000 per token. This opinion, in particular, is held by NewsBTC portal analyst Reynaldo Marques, who expects the cryptocurrency to reach $40,000.
Author: Dmitry Noskov - expert at the StormGain crypto exchange (platform for trading, exchanging and storing cryptocurrency)
Subscribe to ForkNews on Telegram to stay up to date with news from the world of cryptocurrencies
You May Also Like
Crypto kitties are taking over the world
CryptoKitties is a new blockchain game where you can buy, breed and trade virtual cats with Ethereum coins. The project was launched a week ago by AxiomZen and at first glance resembles a blockchain version of the famous Pokemon cards. Over the past few days, the project has gained explosive popularity.
US regulators are looking into Ethereum
US federal regulators are currently studying whether Ethereum can be considered a security. According to the Wall Street Journal, regulators at the Securities Exchange Commission (SEC) and the Commodity Futures Trading Commission (CFTC) are examining whether many cryptocurrencies - not just ICOs - should be regulated under federal securities laws.
