Daily Digest 12/20
Insight on the biggest stories of the day. “Neither this post nor any other on cryptofal.com should be taken as financial advice. It is not.”
Ethereum Launches The Merger Testnet
After years of work, ETH is finally coming close to moving to full proof-of-stake and abandoning the current proof-of-work consensus. The ETH 2.0 merger is finally launching on the Testnet to make sure that everything is functioning correctly before going live.
This merger will eliminate the need for miners to validate transactions on the network and instead would be carried out by shakers who deposited 32 ETH into staking contracts. So far 2.3 million test ETH has been deposited by 72,000 validators. The Beacon chain, the real network, already has $33 billion worth of ETH staked by 272,000 validators.
Once this merger is official it will bring Ethereums environmental impact down by 99.9% and will lower its inflationary rate to 0.2% a year. Through EIP-1559, which was released over the summer, ETH also introduced a deflationary mechanism to the network in the form of token burns.
This merger is expected to go through in the summer of 2022 unless there are more delays that push back the launch. It was supposed to go through in December this year but more time was needed to get things right.
Jackson, Tennessee to become the first U.S. city to add Bitcoin as a payroll option
Bitcoin as well as the stock market is having a really tough time over the past few weeks and continued that trend today. The Omicron variant is starting to bring fear back to the markets globally and schools and businesses begin to close again. This on top of inflation and rising prices is causing absolute panic again.
As an investor, we can take a step away from the charts for a minute and remember that it is not all about the price it’s still more about the utility. Jackson, Tennessee recognizes that and they will be the first state to add Bitcoin as a payroll conversion for workers.
“The RFP is open!” the elated mayor said in an address. “The 22nd (December) is when the respondents have to respond to the RFP. So once the 22nd hits, we’ll open the bids, have the committee, and then they’ll review it. They’ll probably make a recommendation to the council in February.”
Miami has been putting a lot of resources into Bitcoin and blockchain this year first by starting their own City token as well as allowing people to use BTC to pay their taxes. They will also be considering the same as the city of Jackson to add it as a conversion option.
Finally, the first good story to come out in a little while for crypto so it is encouraging to read today. This will not be what changes the direction of the market but it does make you feel slightly better.
Indian parliament's agenda for winter session no longer includes crypto bill
There was a lot of FUD flooding into the crypto market at the end of November and earlier this month because of the alleged “banning” of private cryptocurrencies in the country of India. The leaders of the country were supposed to be adding a bill making this official during their winter meetings but that seems to have fallen through.
The Indian government is still considering what they would be passing a bill that deals with the use of private cryptocurrencies but it is not likely that it will be voted on by lawmakers at this time. The Parliaments winter session is set to end on Thursday.
India has been involved in crypto controversy before such as in 2020. The country was looking to put a full blanket ban on cryptocurrency but that was overturned by India’s supreme court. The country is still looking at creating its own CBDC through the Reserve Bank of India as well so they are not fully against a future involving crypto.
Enough has been said about how absurd the gas fees on Ethereum have been but when you actually see visuals it really puts it into perspective.
Based on this chart we can easily see that at the beginning of the year gas went up as the number of smart contracts deployed also rose. In June the number of deployments started to completely fall off but the gas prices rose to new highs to deploy those same contracts.
This also shows that there is a lot of transactions occurring on ETH bringing the gas price up. For developers this makes ETH really expensive to build on and a big reason for the increase in interest of other layer-1 blockchains like AVAX, SOL, and Cardano.