Ethereum Merge May Have No Benefits? Morgan Stanley\'s Bearish View

A new report by Morgan Stanley, one of the largest financial institutions in the world, has addressed Ethereum’s (ETH) upcoming merge. But is the highly anticipated event all it\'s cracked up to be?

The Ethereum blockchain\'s planned Merge, an upgrade that changes it from a proof-of-work (PoW) system to a more environmentally friendly proof-of-stake (PoS), has been touted as a game-changer. However, not everyone is convinced. Morgan Stanley analysts are suggesting the Ethereum merge may have no benefits, or at least, fewer than expected.

In a report explaining the principles of Ethereum to investors, Morgan Stanley warned that the blockchain tech underlying most of the world’s “decentralized finance” sector faces significant hurdles even after the merge.

Laying down the bear case for Ethereum, the Morgan Stanley analysts said, “Ethereum faces more competition in the smart contract market than Bitcoin faces in the store..." This increased competition, coupled with other factors, could diminish the positive impact of the Merge.

While the shift to PoS aims to reduce energy consumption and potentially increase transaction speed, JPMorgan, in a report dated 22 de sept. de 2025, also spelled some concerns about the Ethereum blockchain following the network\'s transition to a proof-of-stake (PoS) consensus mechanism, a process that was predicted to offer advantages. These concerns, along with Morgan Stanley\'s assessment, raise questions about the true benefits of the Ethereum Merge and its long-term impact on the crypto landscape.

Is the Ethereum Merge overhyped? Only time will tell if it delivers on its promises, or if Morgan Stanley\'s pessimistic view will prove correct.