Yuga Labs Supports the Ethereum Merge

[TL; DR]

Yuga Labs has promised to recognize the Ethereum PoS after the Merge.

The Merge will improve transaction speed and user experience.

Binance, Tether and Chanlink are among dozens of blockchain that have extended their support for Ethereum PoS.

Ethereum PoS will reduce energy consumption, the current protocol’s greatest weakness.

Introduction

The change in the Ethereum working model will bring new developments to the entire community and its functionalities. It will also affect the way users interact with its products such as Ether, dApps and Non-fungible tokens (NFTs). Basically, the Merge will improve transaction speed and the user experience. The Ethereum Merge is planned for September 2022.

What is the Merge?

The Merge is the Ethereum blockchain’s transition from the proof of work (PoW) consensus mechanism to the proof-of-stake mechanism. On the date of the Merge, Ethereum is going to connect its mainnet to the Beacon Chain (PoS).

Yuga Labs to recognise NFTs on the Ethereum PoS

So far, many crypto projects have given their support to the Ethereum Merge. They have promised to support the new development as it will bring several positive changes to the blockchain sector, considering that over 90% of decentralized applications (dApps) exist on the Ethereum blockchain. The latest development where Yuga Labs’, the developer of BAYC NFTs, confirmed that it will accept NFTs existing on Ethereum PoS is important.

Its decision to support NFTs on the Ethereum PoS comes at a time when some experts believe that there could be a duplication of NFTs on the Ethereum PoW protocol. Yuga Labs, however, have made it clear that its acceptance of the NFTs depends on the post-merge NFT license. Above that, it has promised to support any other products that exist on the Ethereum PoS blockchain.


Several popular blockchains have also clarified their positions regarding the Merge. Already, Binance, Chainlink and Tether said that they will support the new protocol, meaning that they will not recognise any products that will exist on the Ethereum PoW after the Merge. The stance these organizations have taken aims to down-grade any potential Replay Attack.

Yuga Labs

Yuga labs, one of the leading NFT development platforms, was launched in February 2021 in the United States. Many people know this company for its Bored Ape Yacht Club (BAYC) and its collection of 10,000 Bored Ape NFTs. This followed the introduction of the BAYC NFT mint in April, 2021.

Yuga Labs has other fascinating developments. It launched a special NFT collection for the APE Bored holders, Bored Ape Kennel Club (BAKC). Then, on 28 August 2021, it introduced the Mutant Ape Yacht Club (MAYC). From there, Yuga Labs rose from strength to strength as most of its NFTs are trending. Notably, these NFTs are also making waves in the secondary market. In addition, its token APE is performing fairly well on the market.


To add to its growing product line, Yuga Labs acquired CryptoPunks and Meebits which are two very popular NFT communities. In its future developments, it plans to establish a metaverse. According to this plan, the metaverse will have 200 000 plots called the Otherdeeds. Notably, Greg Solano and Wylie Aronow, who used the pseudonym Gordon Goner and Gargamel for a long time, are the brains behind this expanding project.

The impact of the Ethereum Merger on NFTs

Analysts anticipate that theEthereum Merge will bring short term and long term positive impacts to the blockchain sector in general and the NFT industry in particular. However, other experts have pointed out a few negative effects of the Merger.

Possible Replay Attack

Probably, the most anticipated negative effect of the Merge is the Replay Attack. Some experts say that there will be a duplication of NFTs on the Ethereum PoW and Ethereum PoS which can expose the NFTs to risks. Basically, the Replay Attack occurs when the system shares the transaction data on both protocols.

To avoid this scenario, the NFT owners should not interact with the Ethereum PoW fork. In fact, Adam McBride, the renowned NFT archaeologist, is the first person to suggest that. However, he maintains that there is a high unlikelihood of such an occurrence, although everyone should be prepared.


Positive Impacts

The Ethereum developers have, so far, given no hint on possible negative effects. However, there is an array of positive developments that will follow the launch of the Ethereum Merge.

Reduction in Minint Fees

The Ethereum Merge gives room to the development of Shards which should help in reducing the transaction fees on the network. Sharding is a process of dividing the blockchain into partitions called shards, which act like mini-blockchains within the protocol. This will help to share the network’s computational power, thereby reducing congestion and high transaction fees. This is because shards reduce points of failure within the blockchain.


The decrease in the blockchain fees implies a reduction in the NFT minting charges.

Easy NFT minting process

Analysts believe that the creation and maintenance of NFTs will be very easy. The main contributing factor is the speed of the minting process. This is because after the Merge few bottlenecks will exist in the system.

Decrease in energy consumption

The Ethereum PoS will result in a 99% decrease in energy consumption because it will shift from the control of miners to a truly decentralized system where the majority participates. High energy consumption through ETH mining has been a great debate in the blockchain space. The antagonists of the blockchain technology accuse Ethereum and Bitcoin for consuming excessive energy, of which part of it was produced using fossil fuel. This led to a conclusion that cryptocurrencies are damaging the earth.

Conclusion

Yuga Labs has confirmed that it will accept NFTs that exist on the Ethereum PoS blockchain. However, it will have transactions with Ethereum based parties when Ethereum (PoS) obtains the relevant NFT license. Analysts anticipate that in the short run, the Ethereum Merge will lead to fast transactions and low energy consumption. In the long run, after the implementation of Sharding, the network will have lower transaction fees.



Author: Mashell C., Gate.io Researcher
This article represents only the views of the researcher and does not constitute any investment suggestions.
Gate.io reserves all rights to this article. Reposting of the article will be permitted provided Gate.io is referenced. In all cases, legal action will be taken due to copyright infringement.