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Ethereum Merge, explained
Kevin Callahan
Ethereum Merge, explained
It's been a little over a month since the Ethereum Merge occurred, which reduced Ethereum's energy consumption by a shocking ~99.95%. There's been a lot of speculation about what it means for the blockchain community, developers and investors. Some people perceive it as a new beginning for Ethereum, while others claim that it spells disaster for the future of this blockchain. So what is the Ethereum Merge, exactly? Why was it so important, and what will happen next? In this blog post, we'll attempt to answer those questions.
What is the Ethereum Merge?
Ethereum is the second most widely used blockchain, ranging its use cases from Web3 and non-fungible tokens (NFTs) to decentralized finance (DeFi).
The Merge is Ethereum's upgrade from the original proof-of-work mechanism to proof-of-stake, executed on September 15, 2022.
On this day, Ethereum's original execution layer (the Mainnet that has existed since genesis) merged with its new proof-of-stake consensus layer, the Beacon Chain. It eliminated mining, which is extremely energy-intensive, and instead allowed the network to be secured using staked ETH. It was an exciting step in realizing the Ethereum vision — more scalability, security, and sustainability.
Why was the Merge so important?
The Merge was a crucial upgrade for Ethereum because it addressed one of the main criticisms of proof-of-work blockchains: their energy inefficiency.
Mining requires a tremendous amount of energy, which is bad for both the environment and scalability. By moving to proof-of-stake, Ethereum can now run on a fraction of the energy that it used to. This makes it more sustainable in the long run and also allows it to scale much better.
The Merge completed Ethereum's transition to proof-of-stake consensus, officially deprecating proof-of-work and reducing energy consumption by ~99.95%.
In addition, the Merge was an essential step in Ethereum's transition to becoming a fully decentralized platform. In proof-of-stake, there is no longer a need for centralization around miners — anyone can become a validator by staking ETH. This makes the network more secure and resilient, further eliminating central points of control.
What happens next?
The Ethereum Merge is a hugely significant event for the blockchain world. It proves that proof-of-stake can work on a large scale and that blockchains can be upgraded in a major way without compromising security or decentralization. This paves the way for other blockchains to follow suit and move to proof-of-stake, which could lead to a massive reduction in energy consumption across the blockchain industry.
In addition, the success of the Ethereum Merge shows that it is possible to upgrade a major blockchain platform in a way that benefits everyone. This bodes well for the future of Ethereum and the web3 community as a whole, as it shows that we can come together to make positive changes that move the blockchain industry forward.
Now that the Merge is complete, developers can continue building on Ethereum, knowing that it is now more scalable and sustainable than ever before. And investors can be assured that ETH is a wise long-term investment, as the move to proof-of-stake secures its place as a leading blockchain platform.
