DeFi researcher Claims PoS gives Ethereum the economic structure to overtake Bitcoin

Ethereum’s shifting into proof-of-stake (PoS), make decentralized finance (DeFi) researchers argue that the platform can overtake Bitcoin’s (BTC) throne as the top dog in crypto. Researcher Vivek Raman claimed that after the Merge, ETH inflation will be lower, security will be better and ETH will position itself as a digital bond.

In his Twitter thread, Vivek Raman emphasizes that the upcoming Ethereum Merge could create a better financial structure for the smart contract platform. According to Raman, the shift into PoS lowers Ether (ETH) inflation, gives better security, and positions the crypto as a digital bond.

Raman claimed that after the Merge, ETH inflation will drop from 4.3% to 0.22%. The researcher clarified that this gives the ecosystem a 95% reduction in issuance, limiting the number of ETH that can be sold in a day. 

Moreover, the researcher also described that the platform would be running on better security after the Merge. Mentioning a post by Ethereum co-founder Vitalik Buterin, Raman highlighted that it would cost more to attack the network once it runs on PoS.

Apart from these, Raman also has confidence that the Ethereum Merge will allow ETH to accompany Bitcoin’s use cases as a store of value and a collateral asset. While BTC will function as digital gold, Raman contends that ETH will position itself as a digital bond, and DeFi’s main asset used as collateral.

In earlier July, the average gas fees required to manage the Ethereum network dropped to $1.57, a number that was only seen back in 2020. The drop in gas fees follows the downward trend of NFT sales, with daily NFT purchases dropping to one-year-lows.

Though the network’s gas fees are low, listings for the Ethereum Name Service surged by 200%. This occurred earlier in July when the ENS Dashboard showed a leap from 11,042 registrations to 29,727. The propaganda is also credited to the second-largest ENS sale that happened on the same weekend as the surge in registrations.