A crypto hedge fund manager has revealed the top 3 reasons for the bullish run on Ethereum’s upcoming Merge. He also explained why the leading altcoin project would kill the ‘Ethereum killers’.
Ethereum Merge or Ethereum 2.0
Merge is the term used by the crypto community for the Ethereum Blockchain’s transition from Proof-of-Work (PoW) to Proof-of-Stake (PoS). This is an important evolution for two reasons. First, PoS is much more environmentally friendly than PoW, Ethereum’s current verification system. One of the biggest criticisms of cryptocurrency, and PoW in particular, is the environmental damage. Elon Musk cited PoW as the reason Tesla stopped accepting Bitcoin. Because it has a process that uses more energy than all of Argentina. Even Anatoly Yakovenko, the founder of Ethereum rival Solana, is excited about Ethereum’s move to PoS.
Second, Merge is considered the precursor to Surge, where Ethereum’s scalability issues will be addressed. One of the biggest criticisms of the Ethereum network is that it lags far behind its competitors in terms of transactions per second (TPS). Ethereum is miles behind competitors like Cardano with 250 TPS and Solana with 65,000 TPS. Because it only has 15 TPS. Ethereum founder Vitalik Buterin said at a conference in Paris that the Ethereum network could handle 100,000 TPS after the Surge. But first, Ethereum needs to complete Merge.
3 reasons why altcoin price is going up
Brian Mosoff is the founder of Ether Capital and a ten-year veteran of the crypto industry. Ether Capital is a Toronto-based technology company. One of the largest institutional ETH holders. Beyond Ether Capital, Mosoff has served as an advisor to both the Ontario Securities Commission and the Investment Industry Regulatory Authority of Canada. In a recent interview, Mosoff said he believes Ethereum Merge will push the altcoin price even higher than it is today. He shared three reasons for this.
Putting PoW to rest
PoW narratives have long been debilitating for the cryptocurrency industry. As you follow on Kriptokoin.com, Elon Musk cited energy consumption as a reason for stopping Bitcoin payments for Tesla. Shortly after, the cryptocurrency crashed.
Currently, legislators are considering ways to ban crypto mining companies that use carbon-based fuels in their operations. Environmental concerns are a clear and present danger to the future of the crypto economy. Also, Blockchain is moving to a less energy-intensive method of verifying transactions. Therefore, Ethereum will position itself as a better option for both investors and institutions. Mosoff says institutional investors know that Ethereum transactions “dwarf” their competitors. In this context, he notes that they would be willing to invest if there were no environmental costs.
Institutional capital will stake in Ethereum
Brian Mosoff also says that Merge will lead institutional investors to pour money into Ethereum. “There is a lot of capital waiting on the sidelines,” Mosoff said. They have literally been waiting for Merge and PoS since 2016,” he says. Also, Mosoff says that many institutional investors will be interested in staking and in return being a validator in the PoS system.
Validators receive new ETH as a reward for staking their crypto. Ethereum’s official website says that validators can earn 4.2% APR from the Ethereum Foundation for staking their ETH. Strike’s Jack Mallers says it goes against the ideology behind blockchain and cryptocurrency for large investors to become validators of new blocks in a cryptocurrency network. It is therefore worth noting that this is a cause for concern for PoW advocates.
But for Mosoff, the choice is clear: if you believe in the future of the Ethereum ecosystem, you will want to risk your crypto. “Anyone with a long asset, long ETH, I can’t understand why they didn’t go out and create a position and then stake it,” Mosoff says.
Competitors will lose to Ethereum’s layer-2 solutions
The final reason Brian Mosoff is optimistic about Ethereum Merge is that it will be a major blow to altcoin projects that are branding themselves as ‘Ethereum killers’. Mosoff says that once Ethereum proves itself as a PoS network, thus reducing the cost of creation and energy use, the selling points of Ethereum competitors will drop. In this context, Mosoff makes the following statement:
Ethereum is now moving towards Merge, scaling and layer-2. I think it will be much more difficult to maintain interest in competing tier 1s during this bear market.
Some Ethereum layer-2 solutions both increase the scale of transactions the Ethereum network can handle. One example is Polygon and Arbitum, which aim to lower Ethereum’s costly gas fees. Mosoff specifically mentions altcoin projects such as EOS, Basic Attention Token, Solana, and Tezos, which have key elements of the Ethereum ecosystem such as smart contracts, DeFi, and NFTs, but currently run blockchain activity more effectively than Ethereum. Mosoff makes the following statement:
Will these be the ‘assets’ of 2025? My experience was this: Probably not. However, I bet that Bitcoin and Ethereum will remain number one and number two in terms of market cap for the next five years.
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