The merger or “The Merge” of the Ethereum proof-of-work (PoW) mainnet and the proof-of-stake (PoS) beacon chain is approaching, at the time of writing this note, there are barely 03 hours left to update according to Blocknative’s counter. In this sense, Nathan Thompson, Senior Technical Tech Writer at Bybit, has shared for Cointelegraph en Español his point of view regarding a relevant point of the event that the entire crypto community has followed up on, and is seen as the topic that everyone talks about.
According to Thompson, this topic that has even brought with it all the paraphernalia of the highest grossing movie of the summer, Coming Soon “The Merge”, and generated enough reasons to drive a significant rise in the price of Ether (ETH) at the time. in recent weeks, has encouraged him to give look at some of the protocols within the broader Ethereum ecosystem that could perhaps “benefit” from this event.
“As always, this is not investment advice, but rather a tour of some interesting projects that I like to call “adjacent to The Merge”” Thompson noted.
Lido DAO and Rocket Pool
First off, Thompson mentioned Lido and Rocket Pool, two liquid staking protocols that he says offer investors the ability to earn a future post “The Merge” return on their ETH by staking for it. “Protocols issue derivative tokens that represent tokens staked in the protocol that can be traded. They are called stETH and rETH, respectively,” he said.
Thompson detailed that when “The Merge” occurs, the network will be secured by a network of validators who receive ETH as an incentive. Currently, there are about 400,000 validators earning around 5% annual percentage yield (APY).
“To become a validator, you have to stake 32 ETH (currently valued at over $51,000), which is a high barrier to entry. The stake acts as a guarantee to ensure that the validators behave, so it has to be a large amount.Thompson mentioned.
“Those who cannot afford 32 ETH can pool their resources using Lido and Rocket Pool. The two protocols collect all the funds and use them to sponsor their own validator nodes. The APY is then distributed among the stakers”, explained
Optimism and Metis
Likewise, Thompson mentioned Optimism (OP) and Metis (METIS) two Layer 2s (L2s) of Ethereum developed to relieve congestion on the Ethereum mainnet. Although there are several L2s already up and running, Arbitrum being one of the most popular, according to Thopmson Optimism and Metis they have some of the most developed token ecosystems and are therefore more likely to benefit from the bullish trend based on “The Merged”.
“While Layer 2s do not benefit directly from “The Merge”, they can take advantage of the momentum of their close association with Ethereum. This is due to the effect of the attention economy, which in cryptocurrencies refers to the general principle that what attracts more attention also attracts more capital flow. In fact, both OP and METIS have already experienced a rise of around 50% this month”commented.
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