The activation of the Bellatrix update on the Ethereum network officially took place on Tuesday at exactly 7:35 am EST. This update initiates the start of the merge, which is estimated to end sometime between September 13th and 16th.
The developers have been doing a lot of testing over the years to ensure a smooth transition. However, it would be irresponsible to ignore the risk and effort required to move an asset with $193 billion in capital and hundreds of active decentralized infrastructures. Completely changing the on-chain consensus mode from proof-of-work to proof-of-stake, while keeping the chain functional and active throughout the migration, is a challenging—and hopefully feat—technologically epic. This transition will not only reduce the power consumption of the network by more than 99%, but will also take a real step forward in the development of the capabilities of various decentralized solutions in the industry.
As the founder of Ethereum himself mentions: “The merger is still expected around September 13-15. The Bellatrix hard fork is happening today, *preparing* the channel for the merge.”
The Total Terminal Difficulty (TTD) triggering the merger has been set at 58,750,000,000,000,000,000,000,000. This figure, which represents the combined difficulty of all Ethereum blocks mined, is expected to be reached between September 13th and 16th. When this level is reached, the network will combine its execution level with the new Proof-of-Stake consensus level, which will allow the chain to continue with the new transaction block issuance and authentication system. During the merger, the difficulty level of the Ethereum Proof-of-Work network will increase to the point where it will be impossible to mine new blocks.
In addition to the $34.2 billion value locked in blockchain 2.0 smart contracts, $5.3 billion of Ether is already being used on the new Beacon chain. With so many users on the line, there is no doubt that this is the biggest update in the history of the network. There are already over 410,000 active validators ready to create proof-of-stake blocks and keep the network stable.
How is the transition going? If the real test takes place in a week, we already have some clues. First, the introduction of Bellatrix was done right. The developers noted the success of this implementation and stated that the upgrade to the latest layer of the Fusion runtime, Paris, is well underway. However, since launch, the Ethereum network has experienced a noticeable spike in “skipped block rate”, or how often the network fails to validate a block of transactions scheduled to be validated. This figure has increased by approximately 1700% since Bellatrix went into effect. In other words, while typically 0.5% of all blocks destined for validation on Ethereum fail on the first try, on Tuesday morning over 9% of all blocks experienced this problem. Serious technical problem? Not really, at least if we rely on the various developers who have spoken on the subject.
Ahead of the final update in Paris, all Ethereum node operators — the people and organizations that keep server and network infrastructure up and running — need to update their clients with the latest merge-ready software. Any operator that fails to do so, if and when the merge is completed next week, “will be stuck on an incompatible chain under the old rules and will not be able to send ether or operate on the Ethereum network after the merge.” In short, the spike in the number of missed blocks can most likely be attributed to carriers that have not yet completed this software update, and not a technical error on the network. In other words, the more node operators that have not yet updated their software, the more it will cause skipped blocks in the proof-of-stake chain. According to Ethernodes, 25.2% of Ethereum nodes have not updated their software yet. However, the worst-case scenario in this regard seems to have already been avoided. If less than 66% of node operators update their software, the merger cannot be completed next week. This figure already exceeds 74%.
In short, to complete the topic, bye; Everything is going well.
Much has been written about Michael Saylor over the years in this post, who was the true pioneer of institutional investment in bitcoin through his firm MicroStrategy. However, he definitely doesn’t like the reasons why he is still in the spotlight. The District of Columbia Attorney General sued Saylor, alleging that he evaded more than $25 million in taxes. The lawsuit alleges that Saylor has lived in the District of Columbia for over ten years without paying income taxes from that city. The lawsuit alleges that he evaded income tax by fraudulently claiming to be a resident of other low-tax jurisdictions. The one who recently stepped down as CEO of MicroStrategy responded in a press release that he left Virginia and settled in Miami Beach, Florida ten years ago. “While MicroStrategy is based in Virginia, Florida is where I live, vote and run for jury duty, and it’s the center of my personal and family life,” Saylor said. “I respectfully disagree with the position of the District of Columbia and hope that the courts will find a fair decision on this matter.” The lawsuit also lists MicroStrategy as a defendant, accusing the Northern Virginia company of cooperating with Mr. Saylor to evade taxes.
It should be noted that today marks exactly one year since El Salvador adopted bitcoin as a single currency. Even if the experiment could not start at the worst time of the market cycle, the fact remains that this is a major evolution of the decentralized monetary network, which, it must be remembered, is still very young.
We often compare bitcoin mining (or any other proof-of-work currency) to a lottery between all of its participants. Most of them team up to pool their computing power, thereby increasing their chances of finding blocks, and then share a substantial reward of 6.25 BTC. However, yesterday the solo miner did indeed win the lottery. Someone who is not in such a pool of miners is barely pointing at 270TH on the network. A real drop in the ocean of total computing power supporting the chain. However, it was this miner who discovered block 752,868 yesterday, receiving 6.25 BTC as a reward, which at that time was worth more than $118,000.
Stock market action is bleak to say the least as cryptocurrency markets maintain a bearish correlation. In this regard, it is expected that the decisions of the Fed will continue to strongly influence macroeconomic trends in the short and medium term. If small investors continue to shed their portfolios, others, the giants, take the opportunity to increase theirs. Observers on Binance have noticed a trend towards continued large-scale accumulation by a new unknown Binance futures trading organization. The organization’s long position will be “huge” and “easy” worth 30,000 BTC or more.
Moreover, among the bitcoin-specific indicators, it is interesting to note that the percentage of bitcoins that have not moved for more than a year has reached an all-time high. Whenever there is a top on this data, the price goes up parabolically. In short, when the yellow line on the following chart crosses the price line and peaks, a significant advance begins.
In the current bearish context, less than one dollar of Rivemont Crypto Fund’s two capital is currently being exposed to the market.
This article is brought to you by Fonds Rivemont. Rivemont Crypto Fund is the first and only actively managed crypto fund in Canada. Eligibility for RRSP and TFSA. Accredited investors can find out more here.
Disclaimer: This column does not necessarily reflect the opinion of CryptonewsFR and in no way constitutes investment advice or trading instructions.
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