The chief executive of the world’s largest crypto exchange platform by volume is warning investors that Ethereum’s (ETH) transition to proof-of-stake will likely dash their expectations in one way.
In a new interview with CNBC, Binance CEO Changpeng Zhao says that traders expecting the merge to have an immediate impact on the ETH ecosystem will be disappointed, especially if they believe drastically lower gas fees will be instantly implemented.
“Many people have very high short-term expectations for the merge, they think [that] Ethereum gas fees will drop from $10 per transaction to $0.02 overnight. That’s most likely not going to happen. It’s a long process.
The Ethereum upgrade takes multiple stages over multiple months or years, but it is a very good development though, it is progress in the right direction and it is strong innovation. The merge will happen today or tomorrow, but Ethereum’s gas fees will not drop immediately.”
According to Zhao, who is the world’s wealthiest crypto billionaire, further upgrades for ETH in the future will bring it closer to what people were expecting from the merge.
“But when the other upgrades like sharding kick in, that’s when we expect those fees to drop, which is a fantastic development for the industry.”
Ethereum’s transition from a proof-of-work consensus mechanism to a proof-of-stake has already gone live at time of writing, causing ETH’s price to slightly dip.
ETH is currently changing hands for $1,506, a 6.4% decrease during the last 24 hours and a 15.2% drop from its seven-day high of $1,777.