The second coming of ETH

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ETH 2.0 Is Coming

Ethereum will have a new avatar soon. Under The Merge model, Ethereum will shift to a proof-of-stake (PoS) model in August. But even before that, it’s raking in the moolah. Its Layer-2 blockchain developer StarkWare Industries raised $100 million at an $8 billion valuation on the back of The Merge.

Two layers to itLayer-2 chains, or secondary blockchains, are built independently atop main Layer-1 chains like Ethereum. Think of them as an extension that takes a load off the main chain.

By bundling multiple transactions into a single one, Layer-2 chains can process more transactions per second. And all of this, at much lower gas fees.

Protocols such as Polygon, Optimism, and others process over 3 million transactions per day. On the other hand, Ethereum just takes in 13 transactions per second. Here’s what the blockchain currently looks like:

1. The main proof-of-work chain.

2. The parallel PoS test chain, called Beacon.

Over the next two months, the proof-of-work chain will completely merge with Beacon.

Going greenFor long, massive energy issues have plagued the proof-of-work model. That’s because mining new crypto needs one to solve complex maths, which takes immense processing power.

In fact, the annual global mining of Bitcoin takes in 73.12 TWh of electricity. Just FYI, that's more than the energy needs of Switzerland.

Enter PoS. The system runs on validators, or network nodes, who have put their crypto assets at stake. Because there’s something to lose, these validators' chances of going rogue are minimal. Plus, less power translates to lower gas fees.

The big switch?Crypto experts are predicting a wider switch to Layer-2. Faster transactions and lower costs would be the pull factors.

A lot depends on how Ethereum pulls off the big change without glitches. A smooth switch could also mean some relief from the crypto winter.

BTC’s $30,000 Dreams

Cryptos are finally resurfacing to the shore. After weeks of drowning, leader BTC finally hobbled up ~5% over the past 24 hours. It was trading at $30,806.86, finally crossing the $30,000 threshold.

Holding tight But the market sentiment remains fearful and risk-averse. Crypto followed suit after tech stocks globally plummeted. In fact, the south road still continues for BTC’s weekly losses, which entered its ninth straight week. Experts aren’t signing out yet. The belief is that the worst is over, for now.

Putin’s on their side Speaking of rising from lows, Russia is considering cryptos for international payments. Since it invaded Ukraine, Russia is under heavy international sanctions. That has left it with limited options for global transactions. It has also been thinking of accepting BTC for its gas exports in the future.

Terra Loses, But Wins

The Terra big-bang revival saw a mixed response. Terra’s newly minted Luna tokens shed about 73% of their value within 72 hours of launch. Listing at ~$20, the token is trading at $6.6 levels. But, the old token Luna Classic has rallied over 70% after Binance announced new token contracts.

Ditching algosThanks to a massive crash after TerraUSD was de-pegged from the US dollar, a revival plan kicked in. Do Kwon decided to:

• Abandon TerraUSD and the algo mechanism.

• Split the network into two chains.

• Old chain Terra Classic has Luna Classic tokens.

• New chain Terra has Luna tokens.

• Existing holders were airdropped tokens.

Now what?It’s too early to make predictions. Kwon is silent, but critics such as Ben Armstrong are advising not to buy. A crash of a new token, and that too so soon, is spooking investors.

Metaverse’s NEU Entry

Tata’s superapp NEU is making metaverse-entry plans. ‘Meta-Commerce’ is on the cards, where customers could possibly browse and shop in a digital universe. The TAM? Almost 150 million and counting.

Leading the wayMetaverse is not unfamiliar territory for Tata. In fact, the company wants to dominate the space. Immersive offerings, personalised products, and better customer engagement are just some advantages. It’s a lucrative idea, especially considering the $1 trillion annual revenue potential.

The group has made quick moves. Tata Tea made its metaverse debut earlier this year. TCS is developing metaverse solutions for sister brands Tanishq and Croma. Tanishq customers can try on jewellery virtually. Metaverse is the future, and the Tatas want to be the first ones greeting you there.

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Who are we? There is a lot happening in our world. Everything has layers, and each layer has to be carefully peeled so you, the reader, know how the world of money is changing every day. That’s our promise. Help you unpeel the onions, which are the public markets in the US, India, and crypto, so that you know just a little more.