Ethereum was launched in 2015 and will mark its 7th anniversary by switching to a Proof-of-Stake PoS network). The change, known as the Merge update, will change the basic structure of how the network works and will have a long-term effect on network users. Many members of ethereum ecosystem they have been waiting for these changes for a long time.
They believe that changing the network’s operating model will bring big improvements, such as increased speed and reduced transaction fees. The merger will also affect all projects running on the ethereum network, including NFTs. Many argue that there would be a copy of NFTs once Ethereum’s transition to a PoS network is complete.
A copy of NFTs spells trouble for owners, as there would be two “original” NFTs. Although there is no guarantee that NFT copies can occur, it is still possible. Therefore, creators and owners need to be aware and prepared in case it happens.
The effects of the Ethereum merger
Users, developers, miners, and other members of the Ethereum ecosystem will feel the effects of the Ethereum Fusion. An Ethereum PoS will make it easy for users to validate transactions. Additionally, users will benefit from a reduction in transaction fees as there would be no competition from validators.
The merger will also affect NFTs. Such assets are one of the hottest properties of the Ethereum blockchain. NFTs are one of the biggest contributors to Ethereum revenue. Analysts predict that an Ethereum PoS network will make it easier to mint and hold NFTs. They explain that the use of coal in the network will be reduced by up to 90%.
Negative impact on NFTs?
Famed NFT archaeologist Adam McBride argued that the Merger would also pose certain risks to the owners of these assets. Via a Twitter thread, McBride cited various issues that NFT creators might have post-Fusion.
The Ethereum Merge may put your NFTs AT RISK🚨
Here’s a 🧵thread explaining why & gives you a simple solution to keep your NFTs safe.
— AdamMcBride.eth 🔎 NFT Archaeologist (@adamamcbride) August 11, 2022
He argued that there would still be a Ethereum proof of work network after the Merge if the rumors were true. Therefore, there would be two versions of NFT, one for the PoW network and one for the PoS network. Thus, owners of NFTs could face a problem called a replay attack. That is, an action on the NFT in the Ethereum PoW will occur simultaneously in the Ethereum PoS and vice versa.
Therefore, anyone who accesses a specific NFT can initiate a transaction. McBride said this scenario is a long shot but it can happen. The NFT archaeologist suggested that the best solution for NFT creators to protect their NFTs is to delist any NFTs they have for sale before the Merger occurs. After the merge, they should transfer the NFTs they have on the PoW chain to a new wallet. According to him, this action creates a disconnect between PoW NFTs and PoS NFTs. The Ethereum merger is scheduled for September 15, 2022.