The official countdown to “The Merge” kicked off early Thursday after developers successfully tested Goerli, the last big dress rehearsal for the Ethereum community, as the network prepares to move from proof-of-work to proof-of-stake consensus.
Goerli, which is a testnet for developers before launching their blockchain applications on the mainnet, is the third and final phase among three public testnets leading up to the merge. The Goerli testnet entailed a two-step process which culminated in the testnet merge being executed successfully at roughly 1.45 AM UTC after attaining a Terminal Total Difficulty (TTD) of 10,790,000. Goerli testnet merged with the Prater testnet, effectively transitioning the execution layer client to proof of stake.
In an earlier post, the Ethereum Foundation had noted that “the Goerli/Prater Merge is your last opportunity to ensure that your validators are correctly configured before the mainnet transition”, adding that “running through the transition now is strongly recommended to avoid any unexpected issues on mainnet.”
In less than three months, the Ethereum community has successfully run Ropsten and Sepolia, the two other test networks, raising the prospect of the merge going live before year-end, with a soft date of September 19. The merge entails the Ethereum Mainnet fusing with the Beacon Chain proof-stake System, marking the end of the Proof Of Work consensus.
The Merge Not Priced In?
With The Merge closing in, investors have been taking positions in the market, albeit with mixed feelings. On Wednesday, Ether surged by over 10% house before the Goerli merge, with price posting further gains on Thursday. Whales have also been accumulating Ether in the past two months in the hope that the merge will bolster prices.
In a recent interview, Vitalik Buterin, Ethereum co-founder, stated that the market hasn’t yet priced in the merge. “Once the merge happens, morale is going to go way up. I expect the merge is not priced in,” Buterin said in the EthCC 2022 Experience podcast. Nevertheless, he noted that the upgrade would significantly shift the sentiment of crypto investors, stating that the outcome of the merge would positively impact Ethereum’s price and general performance.
Glassnode, however, warned on Monday that while traders are generally bullish long term, they “appear to be utilising call options to bet on the ETH price into September, futures and options backwardation”, indicating an expectation of the Merge to be a buy the rumour to sell-the-news style event.
Ethereum was trading at $1,905 at press time after gaining over 4% in the past 24 hours, with traders now focusing their attention on the $2,500 overhead resistance.