New Delhi : Indian crypto exchanges are banking on an Ethereum merge to revive trading volume, which has fallen significantly since April. Companies like CoinSwitch and KuCoin are running online campaigns to create awareness among users about the merge and encourage them to invest in ETH and other cryptos based on the Ethereum blockchain.
The merge, one of the most anticipated events in the brief history of crypto, begins at around 10.30am IST on Thursday. It is an update to the Ethereum blockchain, moving it from the current Proof-of-Work (PoW) consensus mechanism to a more eco-friendly Proof-of-Stake (PoS) system.
The PoW system of mining cryptocurrencies, used by tokens such as bitcoin, allows all miners to lend computing power to validate crypto transactions, and therefore draws a lot of computing power. Since much of this power comes from fossil fuels, POW mining is said to be bad for the climate. On the other hand, PoS limits the number of miners, hence reducing the total power consumed by crypto mining.
In a blog post in May last year, the Ethereum Foundation, a non-profit dedicated to supporting the Ethereum ecosystem, claimed that Ethereum would use 99.95% less energy after the merger. Ether, the native token of the Ethereum blockchain, is already the second most valuable crypto in the world, and the merge is expected to boost its value as more developers take interest in building apps on the Ethereum blockchain.
In fact, Merge is already driving up trading volume on crypto exchanges. Indian crypto exchange BuyUcoin said that the exchange has seen a 25-30% jump in ETH trading on its platform. Crypto unicorn, CoinSwitch, said that it has seen a 61% increase in traffic for ETH, while the number of ETH trades has increased by 36% since September 5.
Minal Thukral, Executive Vice President (Development and Strategy), CoinDCX, said, “Trading activity on ETH has seen an increase in traction with 70-80% growth in volume compared to the normal volume on ETH.”
To boost trading activity around the merge, exchanges are also running special offers to encourage crypto traders, many of whom stopped trading due to the ongoing bear phase of the market. These include lucky draws for top traders to win prizes, discounts on trading fees, and more.
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