Frontrun

Share this post

Remembering the merge

www.frontruncrypto.com

Remembering the merge

What happened the night of the merge: NFT drops, hot takes, celebrations, wealth destruction plus a whale paying 45 eth for the first POS block!

John Cook
Sep 15, 2022
1
Share this post

Remembering the merge

www.frontruncrypto.com

On approximately September 15th, 2022 ~12:30AM pacific standard - Ethereum’s consensus mechanism moved from proof of work to proof of stake, signaling the next phase of the protocol’s journey to ultra-sound money and the next generation of internet technology.

Ethereum has now:

  • Achieved deflationary status at gas prices above 15 gwei

  • Reduced energy consumption by 99.95%

  • Reduced the amount of eth issued to validators by 90%

For those who need a speed run on the merge, the Ethereum Foundation is the gold standard on the tldr - below:

Image 1 - what was the merge? source - ethereum foundation

🪦In memory of the event, and as a farewell to the Ethereum miners who served the protocol faithfully until the end, let’s take a moment to celebrate and laugh out loud at some of the hot takes, nft drops, degen activities, and watch parties around the interwebs on the night of the merge”🪦

Level up your crypto knowledge & master the future of decentralized finance.

🎼 Ethereum miners celebrating the life and legacy of their GPU rigs one last time - rest in peace old friend → reddit post here

Image 2 - Tonight we are gathered here to turn off our mining rigs for ETH is no more. It is a sad end but also the start of new beginnings.

🎼 Jonathan Mann - a musician who wrote 5,000 songs for 5,000 days in a row (that’s 14 years) commemorates song 5,000 in celebration of the merge:

Twitter avatar for @songadaymann
Jonathan Mann @songadaymann
✨🐼THE OFFICIAL MERGE SONG🐼✨ songaday.world/auction/5006 👆the NFT of the song (auction closes at 9/22 @ 3pm)
6:20 AM ∙ Sep 15, 2022
316Likes60Retweets

🔥 The Ethereum community bringing heat with the merge memes:

Image 3 - legit sexual undertone with merge memes last night

…. “ahhhhhh finally”….

Twitter avatar for @EthereumJesus
EthereumJesus.eth⟠🙌🏻🦇🔊🐼 @EthereumJesus
The Merge has been finalized.
Image
6:56 AM ∙ Sep 15, 2022
31Likes1Retweet

… “at your age I had a house, a career and two kids”…

Twitter avatar for @Flatbread_eth
Flatbread.eth @Flatbread_eth
Image
2:16 AM ∙ Sep 15, 2022
950Likes186Retweets

…the conversation you hear at most crypto meet-ups in the bay area…

Twitter avatar for @BanklessHQ
bankless.eth @BanklessHQ
You heard her
Image
10:33 PM ∙ Sep 14, 2022
517Likes87Retweets

… the rest of humanity outside of the web3 ecosystem…

Twitter avatar for @poordart
mergedart @poordart
🥂
Image
10:46 AM ∙ Sep 15, 2022
504Likes34Retweets

…and the conversation you’ll have with your grandkids about the merge.

Image 4 - Grandpa, tell me about the merge again?

Share

🖥️ NFTs and POAPs commemorating the merge

  • Mainnet canvas POAP

  • Mainnet merge POAP

  • Proof of Merge NFT

  • Consensys Regenesis NFT

  • EIPanda white list NFT drop

  • Aave foundation collectible lenster tweet

  • Mergebears NFT

  • Transition paying 45 ETH for the first POS block

The Ethereum foundation dropped a user-curated canvas commemorating the merge. Owners of their limited edition POAP could “tag” the canvas, documenting their participation in the event, with funds from the sale going to Stateful Works → reddit post here

The canvas page 4 hours before the merge…

Twitter avatar for @metajohnnn
John Cook @metajohnnn
#Ethereum mainnet merge party LFG 🔥🔥🔥🔥🔥🔥🔥 app.poap.art/mainnet-merge/
Image
3:57 AM ∙ Sep 15, 2022

…and canvas page after the merge…

Image 5 - Ethereum foundation canvas page commemorating the merge - source: POAP.art

..I couldn’t find this on Twitter, but from the live stream: Stateful ETH is dropping a Mainnet merge POAP by sending $10 of eth to stateful.eth, see the below. Note the comments in the chat were hilarious, screaming “SPAM” non-stop!🤣

Image 6 - mainnet merge POAP collection drop courtesy of stateful eth - source: merge livestream

…the a16z team dropping a dynamic non-transferable NFT which changes its shape up through the merge launch (no longer available)…

Twitter avatar for @blauyourmind
Michael Blau @blauyourmind
Announcing Proof of Merge: a fully on-chain, non-transferable, and dynamic NFT that will change throughout The Merge: proofofmerge.xyz
Image
6:50 PM ∙ Sep 12, 2022
771Likes205Retweets

…Consensys dropping a free commemorative NFT set called “Regenesis”. Live for 72 hours after the merge. As of this writing over 60k NFTs have already been minted…

Twitter avatar for @ConsenSys
ConsenSys @ConsenSys
The #Merge is here & ConsenSys is marking the moment with a set of commemorative NFTs🎉 "Regenesis", celebrates the achievement of the core devs who made the Merge possible. The collection is open to all for the next 72 hrs⏰ Claim your piece of history: merge.consensys-nft.com/?utm_source=ho…
merge.consensys-nft.comThe Merge: RegenesisCelebrate the Merge with a commemorative NFT marking Ethereum’s second genesis. Free mint - open for 72 hours following the Merge.
12:48 PM ∙ Sep 15, 2022
148Likes55Retweets

…EIPandas dropped a limited edition set of 5,875 NFTs to a whitelist of adopters. The floor price was was 5 ETH at launch but has since dropped to 0.02…

Twitter avatar for @nuwtox
nuwtox.eth 🐼 @nuwtox
Plenty of @EIPandas with @nuwtox backgrounds! 💪
Image
8:36 AM ∙ Sep 15, 2022
23Likes3Retweets

…Aave foundation commemorates the merge with a collectible tweet on lenster, free to anyone with a lens profile…

Twitter avatar for @AaveAave
Aave @AaveAave
Congratulations to the entire Ethereum community on this monumental achievement. Remember this historic day forever by collecting this special ghost on Lens. lenster.xyz/posts/0x02-0x0a
Image
6:58 AM ∙ Sep 15, 2022
435Likes71Retweets

…Merge bears public minting up through the merge launch..

Twitter avatar for @MergeBears
MergeBears.eth 🐼 (Merging Sep 15th!) @MergeBears
Phase 1 of @MergeBears minting is LIVE! Go to mergebears.com and Mint ONE for the next hour if you were on the Black & White List!
Image
7:28 PM ∙ Sep 13, 2022
9Likes4Retweets

…and my favorite: thetransition.wtf paying 45 eth for the first block created after the merge. Transaction details here and block details are depicted below:

Image 7 - first block created post proof of work source - etherscan

…The premium paid for this transaction is definitely commemorative in nature. The transition has minted a limited edition of 100 NFTs commemorating the move from proof of work to proof of stake. You can see the contract address in the transaction details that correspond to the NFTs. Transition NFT #1 currently has a floor price of 1 ETH on opensea. So far the Transition team is doing better than the VanityBlocks folks who turned the last PoW block into an NFT at a cost of ~32 eth. The current floor price of the “Last POW Block” on opensea ? 10 eth. At least they’re not the artists scammers who are trying to hawk Vitalik’s first tweet post-PoW as a “1 of 1” NFT mint for 69 eth or $100k. Sanity prevails, for now, as the auction has no takers.

Share

💰 The merge and ultrasound money

  • Aave variable lending rates > 100%

  • Ethereum experiencing ultrasound money - for a minute

  • leveraged long eth traders get rekted

In the spirit of a united DeFi degen community, there were for sure some questionable activities leading up to and shortly after the merge. Aave’s variable borrow and lending rates on Ethereum were 71% to lend and 191% to borrow within the hour of the merge. Note that borrowing and lending eth on the platform is temporarily frozen, but post-merge rates have fallen back to 1% to lend and 5% to borrow.

Image 8 - aave ethereum lending rates before and after the merge - source aave.com

Gas fees immediately after the merge peaked as high as 100 gwei according to etherscan’s gas tracker. This caused an immediate rallying cry to the ultrasound money community as, for a very short period, eth became deflationary. The revenue it collected + the amount of eth burned was greater than the amount of eth paid in security. ~12 hours later, we can see that average eth gas prices are now down to ~11 gwei..not so ultrasound.

Image 9 - ultrasound money immediately after the merge and 12 hours later source - ultrasound.money

…and just as I predicted in my previous analysis “A case for $1,200 Ethereum”, long positions are getting rekted post-merge. Degens are using platforms like GMX and FTX to enter into leveraged long positions to benefit on the upside of the merge despite the downward macroeconomic pressure we’ve discussed in other guides. The net result? Their positions were liquidated, in aggregate $104mm of wealth was destroyed in a 12-hour window.

Image 10 - degens getting rekted on leveraged long eth positions shortly after the merge - source coinglass.com

🎉 A night of celebration

Share

Degenerates aside, the eve of the merge was a night of celebration, and I’m glad to have had the opportunity to participate.

The Ethereum foundation launched a mainnet viewing party…

Image 11 - Mainnet viewing party and celebration - a night to remember!

…and shortly after midnight, in an eerie moment of silence, the consensus layer switched to proof of stake, the merge was over and the Twitterverse celebrated!

Image 12 - a collage of “POS activated” and congrats messages from around the twitterverse

Cheers to the entire Ethereum community and the web3 ecosystem at large. It’s quite impressive that a decentralized group of enthusiasts were able to successfully upgrade a $200 billion dollar financial system with zero downtime. Goldman Sachs should take note!

Forever an eth permabull,

John Cook
September 15th, 2022
San Francisco, CA
www.frontruncrypto.com

Level up your crypto knowledge & master the future of decentralized finance.


In case you weren’t sick of the merge, here’s more merge-related content:

  • Ethereum foundation mainnet viewing party

  • A tldr on the merge 👈 if you want a speed run on the merge

  • Mapping out the merge 👈 if you want a 40-page deep dive on the merge

  • How the merge impacts supply


Share this post

Remembering the merge

www.frontruncrypto.com
Previous
Next
Comments
TopNewCommunity

No posts

Ready for more?

© 2023 Frontrun
Privacy ∙ Terms ∙ Collection notice
Start WritingGet the app
Substack is the home for great writing