The merger is an update to the Ethereum blockchain, the technology behind the second largest cryptocurrency, and other technologies in the crypto ecosystem, such as non-fungible tokens (NFTs). This Ethereum update, or “merger” as it’s called, will change the way new crypto transactions are conducted on the Ethereum blockchain. Dubbed “merging,” Ethereum is moving to a more energy-efficient method of verifying transactions that take place on the platform, known as proof of stake. With the help of Proof-of-Stake, Merge is expected to reduce the energy consumption of the Ethereum blockchain by 99.9%, the developers said.
After working through several technical proposals and issues, on December 1, 2020, the Ethereum community launched “Beacon Chain”, a Proof-of-Stake consensus testbed that runs alongside and in collaboration with the leading Ethereum network. The official starting point for the network transition occurred at the end of 2020 with the launch of Beacon Chain, a proof-of-stake (PoS) version of Ethereum and the main Ethereum proof-of-work (PoW) blockchain.
Crypto has been pending for a recalibration forward toward sustainability, one that not only maximises the value proposition that cryptocurrency and blockchain applications present for cryptocurrency users but also for Web3 climate innovators, the next generation of environmental activists, as well as US climate efforts more broadly. This transition will change Ethereum from its present Proof-of-Work (PoW) system to a Proof-of-Stake (PoS) system. Ethereum provides the technological backbone for hundreds of Web3 applications and 71 million Ethereum-based cryptocurrency wallets.
The update is expected to reduce the power consumption of the popular Ethereum cryptocurrency platform and lay the foundation for future improvements that will make the platform more accessible and cheaper to use. The “merger” is expected to reduce Ethereum’s carbon footprint by more than 99%, making Ethereum more attractive to environmentally conscious investors. The merger has been planned since 2014, before the official introduction of the blockchain. As a result of the merger, Ethereum will completely lose Proof of Work, the power-hungry system it currently uses, in favour of Proof of Stake. The long-awaited merger of the #1 intelligent contract blockchain will make Ethereum a more energy-efficient technology.
The PoW and PoS protocols aim to maintain the decentralised and secure nature of the blockchain network by validating transactions. Through the process of mining, Bitcoin employs the PoW method to control the generation of blocks and the integrity of the network. PoS is an alternative consensus technique that gives token holders authority over the web. PoW has been criticised for using a lot of energy.