(Camylla Battani/Unsplash)Will Ethereum fees decrease after the Merge?
No.
Ethereum transaction fees are not expected to change as a result of the Merge. Future network updates, like danksharding and proto-danksharding, may help to address Ethereum's high network fees, but these updates are not expected until 2023 at the earliest.
The main salve for Ethereum’s transaction fee woes remains rollups – third-party networks like Arbitrum and Optimism that bundle transactions and process them separately from Ethereum’s mainnet.
Will Ethereum transaction speeds increase after the Merge?
Yes, but barely.
On average, Ethereum blocks are issued once every 13 or 14 seconds in today’s proof-of-work (PoW) system. After the merge, proof-of-stake (PoS) blocks will be issued in regular 12-second intervals. This is not an improvement that most users will notice, and it still places Ethereum behind rival blockchain networks like Solana and Avalanche (though well ahead of Bitcoin, where a new block is mined every 10 minutes on average).
Just like with transaction fees, those looking for improved transaction speeds will need to look to Ethereum’s third-party rollups.
Will the Merge increase the price of ether (ETH)?
It’s hard to say.
With so many variables and unknowns, it is impossible to predict what will happen to Ethereum’s token price as a result of the Merge.
The Ethereum community has for years positioned the Merge as a massive upgrade to the network’s core technology. Along with addressing concerns about the network’s environmental impact, PoS will introduce a new form of utility for Ethereum’s native ether (ETH) token in the form of staking.
But the Merge is not guaranteed to boost the ETH price. The Merge will also introduce changes to the rate at which ether is issued and how it is distributed. These changes could be positive or negative depending upon whom you ask. There is also a risk (however small) that the Merge will fail, or that PoS will prove less secure than PoW.
There is also speculation the Merge has already been priced in by the market.
Is proof-of-stake better than proof-of-work?
There are trade-offs.
According to the Ethereum Foundation, the nonprofit that funds Ethereum ecosystem development, PoS will cut Ethereum’s energy usage by around 99.95%. PoS advocates also argue that PoW mining centralizes control in the hands of those who can afford to buy fancy crypto mining rigs, called ASICs. They say PoS – which hands network control to those who “stake” crypto with the network – makes attacks economically infeasible and self-defeating.
PoW proponents counter that PoS staking carries its own centralization and security risks, making it possible for malicious actors to directly “buy” control of the network. They also point out that PoS is a less battle-tested system than PoW, which has proven resilient as the backbone of the two largest blockchain networks.
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