Also today, what Ether investors should expect on the day of The Merge.
We're doing things a little differently in the CoinMarketRecap podcast. Connor and Molly Jane are finding out everything you need to know about Ethereum's imminent switch from Proof-of-Work to Proof-of-Stake. Supporters tell us about the benefits it'll bring in the future — and what ETH investors should expect on the day. Plus, two prominent critics explain why they want a Proof-of-Work blockchain to continue — and raise fears that The Merge will affect censorship resistance and privacy. You can find us on Apple Podcasts, Spotify and Google Podcasts!
Queen Elizabeth II has died at the age of 96, ending a 70-year reign. And now, some in the crypto industry are being criticized after a series of altcoins were released in her name. Dozens have now emerged — with names that include Queen Elizabeth Inu, RIP Queen Elizabeth, and Spirit for Queen Elizabeth II. One critic warned it is a "bad look for crypto" — especially considering that the United Kingdom is about to enter a prolonged period of national mourning. In other developments, an NFT collection that has been generating new portraits of the Queen every day since July has announced that it is closing down. The endless stream of altcoins has led to accusations that creators are attempting to capitalize on Her Majesty's death.
Fears that The Merge will spark huge selloffs of Ether are unfounded, according to the co-founder of Bankless. A large amount of ETH's circulating supply is currently locked up in the deposit contract, which first opened back in December 2020. The latest figures suggest 13.6 million ETH is staked right now — and questions have been raised about whether there's a danger this could all be unlocked at once. But speaking to the CoinMarketRecap podcast, David Hoffman stressed this will be a gradual process — and even if everyone was to try and unstake at once, it would take two to three months before their funds were returned. Hoffman also argued that it's unlikely many stakers will want to sell anyway — calling them "Ether permabulls."
As the switch to a Proof-of-Stake blockchain approaches, ETH investors are being told that "no news is good news." Software engineer Chris Anatalio told our podcast: "All of the changes to the actual network should not really affect everyday holders of ETH." A number of exchanges have confirmed that they will temporarily suspend deposits and withdrawals while the upgrade takes place. However, transfers will resume as soon as the network is proven to be stable. Anyone staking on centralized exchanges shouldn't need to take action either, as the likes of Coinbase will handle all of the technical details on your behalf. But if you run your own node, Anatalio says updates will be needed to ensure you receive staking rewards.
Cryptocurrency stolen by a North Korean hacking group has been seized for the first time ever. Chainalysis says more than $30 million taken in March's Ronin Bridge hack has been recovered. While this is an encouraging sign, it's worth noting that more than $600 million was stolen from this blockchain, which powers the Axie Infinity game. Chainalysis explained that advanced tracing techniques were used "to follow stolen funds to cash out points and liaise with law enforcement and industry players to quickly freeze funds." According to the company, the seizures prove "it is becoming more difficult for bad actors to successfully cash out their ill-gotten crypto gains" — but there is still work to be done.
The U.S. should consider "eliminating" Bitcoin mining unless steps can be taken to make it more environmentally friendly, according to a White House report. Figures in the report suggest that the global electricity usage for cryptocurrencies stands at 0.4% to 0.9%. But America is home to about a third of global cryptoasset operations — meaning 0.9% to 1.7% of total U.S. electricity usage has been linked to mining. "This range of electricity usage is similar to all home computers or all residential lighting in the United States," the report adds. Authors warn climate change causes heatwaves, wildfires, extreme weather and damage to crops — leading to deaths. Estimates suggest climate disasters cost the U.S. $145 billion in 2021 alone.