KuCoin’s Lyu: The Merge’s value is ‘difficult to overestimate’ but beware technical risks
13:47, 14 September 2022
There is no shortage of hype surrounding the upcoming network upgrade of Ethereum (ETH), with parties popping up that are dedicated to watching the event unfold and the launch of a Google (GOOG) countdown to mark the occasion.
But Johnny Lyu, founder and chief executive officer of the cryptocurrency exchange KuCoin (KSC), has told Capital.com that The Merge’s value for the industry is “difficult to overestimate”.
Lyu also warned that “not everything may go smoothly” as he referenced the unexpected technical issues that have accompanied Ethereum’s network updates in the past.
What is your sentiment on ETH/USD?
ETH to US dollar
Ethereum ‘can expect a surge in popularity’
With The Merge’s final step just around the corner, Lyu foresees decentralised finance (DeFi) developers flocking to Ethereum as a result of the update’s anticipated improvements.
“The final stage of The Merge is expected to finally solve the problem of scaling and transaction speed. As a result, we can expect a surge in the popularity of Ethereum among DeFi application creators, who have recently massively favoured competing networks, such as Solana (SOL), Polkadot (DOT) or Polygon (MATIC),” Lyu predicted.
“It is also difficult to overestimate the value of the update for the development of the entire blockchain industry in general and technologies such as Web3 in particular. The transition to Ethereum 2.0 may bring new opportunities for the creation of new applications for which the speed of transactions is important.”
KCS to US dollar
But KuCoin’s CEO also warned of potential technical issues. “The Ethereum network updates have repeatedly been accompanied by unexpected technical problems, and this time not everything may go smoothly,” he said.
Ethereum blockchain’s transition from a proof-of-work (PoW) operation to a less energy-intensive proof-of-stake (PoS) system can be traced back to 1 December 2020 with the launch of Beacon Chain, but it has been hit with several delays on the way.
Markets in this article
Related topics
