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Once in a Generation Opportunity With Ethereum

By johnwege | johnwege | 17 Aug 2022

If you have been following my articles for a decent amount of time, you will have probably noticed that I talk most about Bitcoin and also building a passive income stream.  Those are the two topics that I'm the most passionate about and talk about the most.  But, perhaps you would be surprised to find out that I am nearly as passionate about Ethereum as I am about those other two topics.  I just don't usually discuss ETH as much as I should.  But today is Ethereum's day to shine, and I'm going to tell you why today, right now, there is a once-in-a-generation type of opportunity with Ethereum.  People who invested in Ethereum already, and even those who get in over the next week few weeks will have possibly had a chance to change their lives forever.  This is something that even has me feeling extreme FOMO, and has been causing me to accumulate as much Ethereum as humanly possible.

So without further delay, let's talk about this once-in-a-generation opportunity and why you need to get prepared for it now.

You may have guessed what I'm talking about already, but yes the event that I'm talking about is the Ethereum merge that will be taking place in September.  This will have the Ethereum protocol change from being a proof-of-work chain, changing into a proof-of-stake chain. But there is so much more to it than just that.  But the first thing you need to know about this merge is the history behind it.  The Ethereum merge from POW to POS has always been in the cards since the creation of Ethereum, but the development of this update has been constantly delayed.  The merge was originally planned to be released in 2017 or even before.  And has been delayed for upwards of 5 years now.  So much so, that many people in the market highly doubted if Ethereum would ever be able to pull off the update.  This slower development is what opened the door for other "ETH Killer" layer 1 chains to come to the market and try to dethrone Ethereum.  Chains such as Cardano, Solana, Avalanche, Luna, Tron, NEO, EOS, and the list goes on and on.  Even with those heavy delays, and the emergence of handfuls of rivals, none have been able to overtake Ethereum.  Although, it must be said that it is all flowers and rose petals for Ethereum.  This upgrade doesn't involve everything that it once was planned to.  It was originally penned Ethereum 2.0 and would change ETH to a POS chain, it would also include upgrades to scale the protocol and make transactions much faster and cheaper, along with many other upgrades.  Instead, the penned name ETH 2.0 was scrapped, and this upgrade is focusing only on changing to a POS chain, and also a few other changes as well. 

Why You Should Be Bullish About This 

The first reason this Ethereum merge should have you incredibly bullish is the fact that for many years, the failure of Ethereum to upgrade has been its biggest point of FUD.  Detractors have often pointed at the slow progress and said that the upgrade would never happen, that it would be better to use other chains.  If the ETH merge does go smoothly, and it should, then all of the naysayers will come back into the fold.  Throughout the history of cryptocurrency, there have been only 2 seminal moments that will be talked about forever.  The 1st was the creation of Bitcoin, and the 2nd was the creation of Ethereum.  But this will be crypto's 3rd seminal moment; ETH's merge from POW to POS.  As much as I love Bitcoin, one of its greatest points of contention and debate is with it being a POW chain that consumes extreme amounts of power.  With this upgrade, Ethereum will become much more environmentally friendly, and there will be one less thing for detractors to try to poke FUD at.


The second reason why you should be bullish about this merge is how it will change the issuance rate of Ethereum.  The issuance of Ethereum will be decreasing by 90%.  This has often been called ETH's triple halving, as it is comparable to about 3 Bitcoin halvings.  Remember this, each time that Bitcoin has had a halving, a few months later it has always made a new all-time high price.  Imagine if Bitcoin had that halving multiplied by 3.  This would be an event that would shake the industry and cause prices to go parabolic like we have never seen before.  This is exactly what will be happening with Ethereum during the merge.  Then taking into account the continuation of EIP 1559, where ETH is burned during each transaction.  Adding all this together means that there is a very good chance that Ethereum will become a deflationary blockchain, where the supply is continuing to decrease.  While some other chains burn tokens and are deflationary.  It must be noted that up until this point, neither of the blue-chip cryptos, have done it.  This means that this will have a huge effect on the industry and will cause prices to soar.


Now onto the next bullish factor of the ETH merge, staking.  Right now users must lock up their ETH2 into the protocol to stake their coins.  Being unable to withdraw until another protocol upgrade some time after the merge.  The staking rate currently is about 4%, give or take depending on where you're staking.  But that will change soon.  It is expected that the ETH staking rate will double at least after the merge, and could be even higher than that.  Imagine an ETH staking rate of 8%, 10%, or somewhere in that range.  While other chains offer similar high rates, once again we are talking about one of the 2 blue-chip crypto assets here.  A chain that maintains value better than those other chains, and is expected to be around for the long-term.  If you were early into ETH2 staking when it was first released nearly 18 months ago, the initial staking rates that were offered were above 10%.  I got into ETH staking during that "golden opportunity" time and was able to reap the rewards.  It was truly an amazing opportunity.  And now we will be heading back towards those interest rates.  While this is an incredible opportunity for you and me to build our portfolios and also build a passive income.  The truth is that this will be a very attractive opportunity for large organizations.  In the stock market, hedge funds would be considered very successful to gain 6-7% yearly.  They would be able to do that just by staking Ethereum.  There is about to be a stampede rush towards Ethereum.

The thing to consider that should make people excited about the merge, and more importantly, Ethereum is more so a bode of confidence rather than anything that is being added in the merge.  As I mentioned above, this is an upgrade that has taken forever and has become almost legendary in its slow progress.  Causing doubts about if it would ever happen. But it is happening, and most people aren't ready.  It has been said that this transition changing from POW to POS is the most difficult part of the entire original ETH 2.0 upgrade.  Meaning that after this upgrade is completed, the development of the other upgrades should go much smoother and at a faster pace.  When everyone sees this upgrade take place, it will give the market confidence that Ethereum's future roadmap is also possible, and will be able to be achieved.  The fact is that this merge is one of the most important things to happen in crypto's short history.  While initially it could be a buy the rumor, sell the news type of event.  I feel that it will perform similarly to how Bitcoin halvings do.  The actual event day might be a little lackluster, and there probably will even be a price dip.  But a few months after the fact, all the things that I discussed above will cause a supply crunch and shock to the market.  This will cause the price of Ethereum to go to places that we have always dreamed about.  We will look back at today's current ETH price of nearly $1,900 and wish that we would have boughten more while the price was at outlandishly cheap prices.  

How about you? Are you ready for the Ethereum merge?  What are your predictions for what will happen?



As always, thank you for reading!

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