Opinion: Ethereum merge a win for tech heads but fails key test | Stephen Bartholomeusz
Ethereum successfully and seamlessly executed “The Merge” last week in what’s regarded as a brilliant piece of software engineering. While it does address one of the core criticisms of cryptocurrencies it doesn’t, however, resolve their core challenges.
Under the proof of stake architecture, transactions are validated by individuals or companies that have staked their own ethereum tokens as collateral. In effect, by placing their tokens in the staking pool the participants enter a lottery and, if they are chosen to verify a transaction, they are rewarded with ether. If they tried to game the system, they could lose their stakes.
So, ethereum is now more environmentally friendly. That doesn’t make transacting on the platform any faster or cheaper, although its developers say that will come as the fundamental changes to the platform, as a result of the merge, enables them to roll out further upgrades.At present, transactions on crypto platforms are far slower and far more expensive than on conventional finance platforms.
The frauds, the manipulations, the complexity, the lack of regulation and investor security and the sheer volatility of crypto assets are arguably greater obstacles.