In less than 30 days, The Ethereum Merge will happen where the network, which has been a proof-of-work (PoW) blockchain since July 30, 2015, will switch to a proof-of-stake (PoS) consensus method.
According to a Wednesday blog post by the Ethereum Foundation, the Ethereum Merge will now be fully completed between September 10 and 20.
Although the adjustment may not seem significant to Ethereum users and traders, what is changing internally is a highly significant development.
To quench your thirst, we listed here everything you need to know about Ethereum's Merge. But first, let's define what Ethereum is!
What is Ethereum 1.0?
The Ethereum network is a decentralized blockchain that was built in 2013 by Vitalik Buterin, a 19-year-old programmer at that time! Vitalik believed that the blockchain can benefit from the computing power of all connected devices on the network to develop and manage decentralized apps (DApps), Vitalik refers to the Ethereum network as a "Virtual Machine" or a "world computer." Ether, like Bitcoin, may be used to exchange, transmit, and receive value without the need for a third-party intermediary. The Ethereum network's primary goal is not the Ether coin, but rather the Dapps. Also, Ethereum can be used to create other crypto tokens on it that can operate on the network.
Proof-of-Work Vs. Proof-of-Stake
Even though the invention of PoW is credited to Satoshi Nakamoto, the idea was developed in 1993 to combat junk email. However, it remained inactive until Satoshi Nakamoto invented bitcoin in 2009. That may serve as a consensus mechanism to protect the bitcoin blockchain, Nakamoto realized.
The PoS method has gained popularity over the past several years and has been used by some of the biggest cryptocurrency projects, including Solana and Cardano. The fundamental goal of PoS was to move the network's reliance from computer power to cash power, which would boost the network's scalability and efficiency.
In PoS, validators are selected based on the "stake" they have in the blockchain, or how much of that token they agree to lock up in order to be considered as a validator. Putting more coins “at stake” means higher chances of receiving the prize as the validator who publishes the next block.
What is The Ethereum Merge?
The Merge is a strategy to switch the Ethereum blockchain from PoW to PoS in order to reduce energy usage and set the stage for future productivity.
"Blockchain trilemma" was first used by Vitalik Buterin, the creator of Ethereum. In essence, only two of the three important factors—decentralization, security, and scalability—can be optimized by blockchains.
The present implementation of Ethereum 1.0 uses a PoW consensus method, which is comparable to Bitcoin's and is scalability-optimized at the sacrifice of decentralization and security.
The Ethereum foundation opted to redesign its blockchain to prioritize scalability and security at the expense of decentralization as the demand for Ethereum blocks keeps rising.
First off, it unites two distinct blockchains—the PoW Ethereum Mainnet and the PoS Beacon Chain—which is why it's named the "Ethereum Merge."
Launched on December 1st, 2020 to operate in parallel with the Ethereum PoW Mainnet, the Beacon Chain is an empty PoS chain that has no active dApps or transactions at this time.
What Will The Merge Change?
The Ethereum network has been severely criticized over the past few years for its high gas speeds, congestion, and poor network speeds. Because innovation doesn't wait for anyone, especially in such a cutthroat industry, traders and developers alike are looking for blockchains that can easily satisfy demand. So this transition to POS will help Ethereum stay the nucleus of Web 3 and the focal point as well as the driving forces behind the growth of the market luring investors and catching the attention of developers throughout the years.
By switching from PoW to PoS, Ethereum will use 99.95% less energy! However, the fact that PoS requires less energy than PoW does not imply that PoS is superior. When switching from a system protected by energy to a system secured by capital, there are sacrifices, particularly decentralization.
