Ethereum (ETH) Merge Update Finally Activated: Everything You Should Know About ETH Proof-of-Stake
Ethereum, one of the largest smart contract platforms, now operates on a Proof of Stake (PoS) consensus. Let’s briefly review how the Ethereum (ETH) developers and community achieved what is arguably the most ambitious upgrade in Web3 history.
What is The Merge in Ethereum (ETH)
Ethereum’s second-largest blockchain switches to a Proof-of-Stake consensus on September 15, 2022.
- The Proof-of-Work system is replaced in order to make the blockchain more resource-efficient and environmentally friendly.
- The Merge activation sparks people’s interest because of how it works. Ethereum’s proof-of-stake system is called The Merhe. It’s a carbon-neutral, democratic, inclusive and flexible replacement for the inefficient and whale-dominated Proof-of-Work consensus.
- The name is derived from the eth coin abbreviation of Ethereum.
- The Merge upgrade that happened on September 15, 2022 injected the Beacon Chain — the consensus layer — into the mainnet — the transactions layer — . Ethereum’s guarantee of integrity through The
- With The Merge activated, Ethereum integrity is guaranteed by stakers, insted of miners.
- Ethereum miners need to switch to different chains, including Ethereum Classic, Ravencoin, Ergo and more. A small group of Ethereum miners continued to support the Proof-of-Work version of the blockchain under the name ETHPOW.
- The Merge will have significant effects on the ETH monetary system in the long term. However, it won’t affect the cryptocurrency’s short-term price.
Key members of the Web3 community have stated that The Merge was activated without any significant missed block quantities.
Why is Ethereum (ETH) Upgrading
Participating in Proof-of-Work transactions requires purchasing expensive ASICs for transaction validating processes. By contrast, Proof-of-Stake encourage more democratic and environmentally friendly approaches.
The developers and community decided to use Proof-of-Stake because of this. Cryptocurrency mining is not egalitarian; only the rich can share rewards by mining. The more powerful mining equipment someone uses, the higher their chances of receiving a reward. This goes against the decentralized nature of cryptocurrency. Ethereum, Bitcoin, and all Proof-of-Work cryptocurrencies produce a significant carbon footprint because of the electricity they consume for crypto mining. Some critics have even suggested that the practice is environmentally unsustainable.
Ethereum’s Proof-of-Stake style consensus will make the coin deflationary quicker than its original PoW consensus.