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The ETH Merger and What It Means for Ethereum Poker

The moment has finally arrived. After waiting what seems like forever, the Ethereum (ETH) merger was successfully implemented on September 15, as planned. With the merger, Ethereum moved from a proof-of-work consensus algorithm like Bitcoin to a proof-of-stake consensus mechanism like Cardano, Avalanche, and Polkadot. With the change, ETH’s power consumption dropped by one huge 99%. So what effect, if any, will the merger have on online gambling and other related industries?

What is ETH Merger?

In December 2020, Ethereum launched a beacon chain, the first step towards its transition from a proof-of-work (POW) blockchain to a proof-of-stake (POS) blockchain. As a result, ETH users with at least 32 ETH could become validators for Ethereum 2.0, locking up their ETH for future rewards pending the launch of ETH2 and the eventual merger. Flash-forward to the present day, and the fusion is here. This current merger step is just the first of many steps to come, all of which must be completed in order to make Ethereum truly scalable. At present, the effects of the merger are apparently only the change in energy consumption.

Will the ETH merger affect online gambling?

The simple answer is: no, it will not change online gaming and Ethereum poker in the short term. Although the merger is an important step for Ethereum and the cryptocurrency industry in general, it does not change much other than the type of consensus algorithm used by Ethereum. Things like lower transaction fees and faster transaction speeds won’t happen until you complete a few more steps (see image below).

Vitalik Buterin, one of the founders and face of Ethereum, said the merger is just the first of 5 steps. The Verge, the next step, is likely when you see a noticeable effect on online play. This is when transaction speed and throughput will increase. For poker sites that accept ETH and blockchain-based poker platforms, this will translate into lower transaction fees for them and their customers, making the platforms more attractive. It will also increase throughput, meaning more users will be able to access these platforms simultaneously and participate in payment processing or payments without delay. But, until The Verge happens, it’s business as usual for Ethereum online gambling and poker sites.

ETH miners bet on ETHPoW and lose

With Ethereum’s move from proof-of-work to proof-of-stake, many ETH miners have been looking for an alternative asset to mine. This effort is an attempt to replace the billions of dollars earned from ETH mining. While some were planning to turn to Ethereum Classic (ETC), a new project called ETHPoW (ETHW) also emerged and was quickly backed by prominent crypto bigwigs such as Tron founder Justin Sun. .

The ETHPoW chain was spun off from the ETH chain at the time of the merger, so those who bet on using it to earn mining rewards lost. The ChainID released by the project was, in fact, the wrong one, meaning many miners were unable to do so. Additionally, the price of ETHW rose from $22 to $16, then back to $23, before dropping to below $10, all within 8 hours. At these prices, even those who successfully mine the ETHW will not even cover their mining electricity costs.