How The Ethereum Merge Could Affect Shiba Inu

Shiba Inu Ethereum Merge
Credit: Unsplash

Shiba Inu Ethereum Merge
Credit: Unsplash

The Ethereum Merge is one of the most-anticipated and wide-ranging upgrades coming to crypto in 2022, but how will it affect Shiba Inu?

As an ERC-20 token, SHIB is powered by the Ethereum blockchain. This means that everything, from the SHIB burns to the Shiba Inu Metaverse, runs on Ethereum.

So, as the Merge and Ethereum 2.0 draw closer, how will SHIB change as a result of the upgrades?

Shiba Inu And The Ethereum Merge

The most significant change the Ethereum Merge brings in won’t particularly impact how Shiba Inu currently exists and operates. The merge will see the Beacon Chain merge with the mainnet, switching Ethereum over to proof-of-stake from proof-of-work.

This will remove the need for Ethereum mining, as Ethereum staking takes over as the way to validate Ethereum transactions. Putting this onto Shiba Inu, all SHIB transactions will thus be validated through a different method.

As Ethereum claims, this PoS will see Ethereum become a “more sustainable, eco-friendly Ethereum”. Shiba Inu will also be a part of this more "eco-friendly Ethereum".

In practical terms, as The Merge may see the Ethereum blockchain halt temporarily as it transitions over, some Shiba Inu transactions may be delayed slightly.

The more significant changes coming to SHIB will instead happen later down the line, when Ethereum introduces sharding.

Speculation has already started about how the merge will impact the price of Ethereum, with some even believing it will cause the ‘flippening’, where ETH flips the Bitcoin market cap. As the Shiba Inu Price does often follow these larger coins, similar speculation will soon begin for SHIB.

Shiba Inu and Ethereum Sharding

Of the changes Ethereum 2.0 will bring, reduced gas fees and more transactions per second are among the most anticipated. However, the Ethereum merge gas fees and transactions will be unlikely to change after the upgrade.

Have an opinion on this article? We'd love to hear it!

This may be especially frustrating to some SHIB holders, who have been hurt in the past through high Ethereum gas fees. The Shiboshi NFT launch, for example, suffered from this issue.

Sharding, however, should see the Ethereum 2.0 transaction per second increase to over 100,000, according to Vitalik Buterin. And, with a larger amount of transactions, also comes lower gas fees, too.

Sharding is not expected to come to Ethereum until 2023, meaning those waiting for these improvements will need to wait. However, SHIB may see improvements before then.

Shibarium and Ethereum 2.0

For Shiba Inu holders, Shibarium may look to solve some of the current issues with Ethereum. As a Layer-2, Shibarium could reduce gas fees for users by bundling up transactions that go through the platform.

And, with the Shibarium public beta set to happen before the end of September, alongside a tentative 2022 launch date, it should come ahead of the full Ethereum sharding upgrade.

Some SHIB holders have discussed the impact of the merge on Shibarium. “It’ll just make our L2 [perform more],” said one user. “After the merge, all L2 will benefit from it, they won’t become competition,” said another.

The SHIB team has already made clear its view that SHIB doesn’t need Ethereum 2.0 to thrive, either. With the likes of ShibaSwap 2.0, the Shiba Inu Game, and plenty more on the Shiba Inu roadmap for 2022 and beyond, SHIB is looking to move faster than the next ETH upgrades.

This Article's Topics

Explore new topics and discover content that's right for you!

Planet Crypto
Have an opinion on this article? We'd love to hear it!