Ethereum Foundation Clarifies That The Merge Upgrade Will Not Reduce Gas Fees

The Ethereum Foundation has asserted that The Merge will not reduce Ethereum gas fees because it is a “change of the consensus mechanism” and “not an expansion of network capacity”.

The Ethereum Foundation revealed that The Merge will not reduce gas fees and it will not allow staking withdrawals until the Shanghai upgrade in an August 17 note.

The note states:

“The Merge is a change of consensus mechanism, not an expansion of network capacity, and will not result in lower gas fees.”

Instead, blockchain is focused on expanding user activity on the layer-2 network and making the mainnet a “secure decentralized settlement layer.” This will make layer-2 network transactions cheaper. Reports have advised Ethereum users to use layer2 network solutions for cheaper transactions.

The Foundation added that transactions on Ethereum will not become “significantly faster after The Merge.” While acknowledging that some minor changes will occur, the platform believes that users using the layer-1 network may not notice any difference in its speed.

The Ethereum Foundation says withdrawals “will remain locked and illiquid for at least 6-12 months after The Merge.” Staking ETH, staking rewards, and newly issued tokens will remain on Beacon Chain until the Shanghai upgrade. However, validators can access “fee rewards/MEVs earned during block proposal” through the mainnet account they control.

The Ethereum Foundation also addressed concerns that there could be mass withdrawals from validators when the withdrawal feature is enabled, stating that “only six validators can exit per epoch (every 6.4 minutes), which is 1350 per day, or just ~43,200 ETH per day out of over 10 million ETH staking”.

The Foundation added that the rate cap will be adjusted depending on the amount of ETH staking remaining to avoid a mass exodus. The Ethereum platform says users do not need 32 ETH to run a node on the network. The Foundation wrote that there are two types of nodes: block-suggestible nodes and non-proposal nodes.

Nodes that can propose blocks on PoS require staking ETH, while other types of nodes cannot propose blocks; instead, “they play an important role in securing the network by holding all block proponents accountable.”

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