Debunking 5 Popular Myths Around Ethereum’s Merge
The Merge is fast approaching. To ensure users have the most accurate information, we debunked some of the many Merge-related rumors on the internet.
Ethereum’s upgrade, known as The Merge, has generated much excitement over the past few months. However, with all the hype, there’s also been a flurry of speculation and false claims spreading through the crypto community. Today, we’ll bust five myths that have been among the most prominent.
Before we dive into it, here’s a quick summary of what’s happening.
The Merge will occur sometime between September 10 and 20, barring unforeseen circumstances, replacing Ethereum’s existing proof-of-work (PoW) consensus mechanism with a proof-of-stake (PoS) model. Once the move is complete, anyone can become an Ethereum network validator by staking instead of mining ether (ETH).
Myth 1: The Merge Will Create a New Token
The Merge is an upgrade to the Ethereum network, not the beginning of a whole new network or token. After The Merge is complete, ether will remain the Ethereum blockchain’s native asset.
Ethereum’s 2018 roadmap was originally titled “Ethereum 2.0.” This may have led some community members to believe that the project team was creating a whole new blockchain. To clear up the confusion, the Ethereum Foundation released a statement in January this year saying it would phase out terms such as “Eth2” and “Ethereum 2.0.” Thus,
Eth1 officially became the “consensus layer.”
Eth2 officially became the “execution layer.”
The Merge is the event of these two layers combining.
As we approach the date of The Merge, users should be wary of anyone offering “ETH2” tokens. ETH holders can refer to our guide for more information on what will happen to their funds during and post-Merge.
Myth 2: Gas Fees Will Decrease
Many users have hoped that Ethereum’s transition to a new consensus mechanism would reduce the network’s notoriously high gas fees. According to the Ethereum Foundation, however, The Merge will not expand network capacity, and thus gas fees will remain unchanged.
That said, Ethereum’s next major upgrade — sharding, which is set to launch in 2023 — aims to address gas fees by reducing network traffic and splitting the blockchain into smaller, more manageable parts.
Myth 3: Transactions Will Become Faster
There’ll be a slight improvement in transaction speed, with block publishing time going down from Ethereum Mainnet’s 13 seconds to Beacon Chain’s 12.2 seconds. Despite this 10% increase in speed, the change will be unnoticeable for most users.
Myth 4: Stakers Can Withdraw Their Rewards After The Merge
If you’re a holder eager to withdraw your staked ETH, note that your funds will be locked for at least 6-12 months after The Merge until the Shanghai upgrade is implemented. For security reasons, Ethereum will rate-limit staking withdrawals once they are enabled.
While ETH rewards from Beacon Chain remain locked and illiquid, validators will have immediate access to tip rewards from Ethereum-based transactions. Those who are holding BETH, on the other hand, will be able to swap back to ETH after The Merge.
Myth 5: Ethereum Will Suspend its Network
The developers anticipate zero downtime if everything goes well during the transition from PoW to PoS. Essentially, the upgrade will just happen, and Ethereum will continue to run smoothly during The Merge.
If you’re holding ETH on Binance, be advised there’ll be a temporary pause on ETH and ERC-20 token withdrawals and deposits; please plan accordingly.
Prepare For The Merge With Binance
Follow our blog and Twitter to stay updated on all things Ethereum and The Merge. The team at Binance will work hard to ensure a smooth transition for users holding ETH. If you’re not a Binance user, get started by creating an account and completing account verification today.
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