Indeed a basic merge would be tricky as both projects use different pegging mechanism, different collateral requirements, different ways of managing margin calls, different reliance on market actors and incentives etc. Definitely a full merge would require a lot of refactoring on both sides. Probably not worth the trouble.

I was more thinking of running one as a sidechain of the other. Since Steem is the one that stands out the most, it would make sense to have Bitshares run as a sidechain of Steem once Steem supports sidechains. From the end user perspective, they wouldn't need to know that there are two chains.

Actually we could even achieve the same without doing a technical merger at all by enabling crosschain atomic transactions between Steem and Bitshares, just as Zooko is trying to do between ZEC and BTC/ETH (see project Alchemy )

But either way, for this to be successful from a marketing perspective, Bitshares would have to operate a change of direction on how it operates its brand image from that of being an independent project / blockchain to that of being a subsystem of Steem just like Liquid and Rootstock will be subsystems of Bitcoin while remaining separate albeit deeply dependent projects. The reason that this is necessary is that end users shouldn't even realize they are using Bitshares at all. They should see XAU, USD, CNY, BTC in their wallet as well as a bunch of tokens (UIA), and they should be able to send BTC and fiat in and out of Steem via the on/off-ramps without even realizing their transaction was routed through Bitshares, a gateway and a bridge. This is what will bring volume to Bitshares and deeper integration with the crypto ecosystem and legacy financial system to Steem while providing a seamless experience to the end users.