Renowned economist Raoul Pal says that after the historic rise, “magic things” will happen in the leading altcoin project.
“Magical things will happen in this altcoin project”
Real Vision CEO Raoul Pal said that the transition of Ethereum (ETH) to PoS will bring “magical” things. The PoS mechanism is expected to reduce energy consumption by 99.95% compared to mining. Meanwhile, the merge upgrade has officially happened, marking its transition to full PoS. On September 15, at 09:42:42, the long-awaited merge saw the merging of the Ethereum mainnet execution layer and the kensensus layer of the Beacon Chain.
The Ethereum Foundation said the upgrade will make the Ethereum network approximately 99.95% more energy efficient. He also stated that it will lay the groundwork for future scaling solutions, including sharding. Ethereum co-founder Vitalik Buterin celebrated the rise in a tweet following the historic transition:
And we’re done! This is a big moment for the Ethereum ecosystem. Everyone who helped make Merge happen should be so proud today.
And we finalized!
Happy merge all. This is a big moment for the Ethereum ecosystem. Everyone who helped make the merge happen should feel very proud today.
— vitalik.eth (@VitalikButerin) September 15, 2022
Raoul Pal claims that after the transitions, investors will flock to Ethereum
Pal points out that this is particularly exciting for the cryptocurrency industry. Because mining will now be an outdated consensus mechanism. It is also seen as the beginning of the bull, as PoS will be a supply shock. Raoul Pal has this to say about the upgrade in a new interview on Real Vision Crypto:
After Merge, a few things happen. There are no miners to sell every day, that’s about six billion dollars lost from sales every month. Then there is a decrease in supply, but this is really due to the increase in network activity. We need to see the network get very high for this to be truly effective. It becomes deflationary but less inflationary. The magic is that you safely incorporate yields into the ecosystem, so this will attract new people into the ecosystem who want to buy ETH for yields.
According to Pal, the cryptocurrency market should have a successful year next year due to the combination of increasing demand and decreasing supply. Sharing his long-term expectations, the analyst presents a positive picture for the sector:
You have a demand shock and no ESG [environmental, social and governance] constraints, which is a misconception, but I know that’s the mandate of the people. Those who are eagerly waiting for the [ETH merger] to happen so that ETH is now yielding are those who want to invest but cannot due to ESG and Bitcoin. You have this technological asset that symbolizes a bright and exciting future with yields, limited supply and a changing macro. This shows me that next year will probably be very good for digital assets.
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