Ethereum is now officially proof-of-stake following the successful Merge
(Kitco News) - The long-awaited Ethereum Merge has officially gone down without a hitch, with the final transition to proof-of-stake (PoS) occurring on Sept. 15 at 06:42:42 UTC at block 15537393.
The Merge saw the Ethereum (ETH) mainnet execution layer merge with the Beacon Chain consensus layer at the Terminal Total Difficulty of 58750000000000000000000, which means that the network no longer utilizes or relies upon a proof-of-work (PoW) consensus mechanism.
With PoW, a decentralized network of miners uses energy-intensive computing equipment to validate transactions and mint new blocks for the blockchain. In PoS, rather than use high-energy miners, validators lock (stake) tokens on the network in order to be able to participate in the validation process and earn rewards for their work.
Following the implementation of PoS, the Ethereum network is 99.95% more energy efficient according to The Ethereum Foundation, and the Merge sets the stage for future scaling solutions, including sharding.
The process of sharding involves splitting the network into 64 partitioned blockchains, or “shards”, that manage specific data segments. Each partitioned blockchain manages specific data segments and has its own ledger. This design takes the strain of dealing with all transactions and interactions off of a single network.
Data from TradingView shows that around the time of the Merge, the price of Ether saw a slight bump in price, trading as high as $1,655 as the transition took place, but has since retreated to support at $1,580 in the face of multiple economic headwinds.
There's still a lot of work to be done
While this moment has been years in the making, the journey to realizing Ethereum’s true potential is only about halfway finished, as the project’s co-founder Vitalik Buterin previously stated that a successful Merge meant that the network’s overall development would be about 55% complete.
Insight into what comes next was provided in the following Tweet from Miles Deutscher, which lays out the next phases in ETH’s development: The Surge, The Verge, The Purge, and The Splurge.
.@VitalikButerin claims that #Ethereum will be able to to process "100,000 transactions per second", following the completion of 5 key phases:— Miles Deutscher (@milesdeutscher) July 22, 2022
• The Merge
• The Surge
• The Verge
• The Purge
• The Splurge
A quick breakdown of what each stage means for $ETH. ?? pic.twitter.com/FnaWww8mHZ
The Surge is intended to increase scalability for rollups through sharding, the Verge will achieve statelessness through Verkle trees, the Purge will eliminate historical data and technical debt, and the Splurge will involve a number of small miscellaneous upgrades.
Jonathon Miller, Kraken Managing Director for Australia, called the Merge “an important milestone for the future of crypto,” and highlighted the significant reduction in energy achieved by removing miners from the equation.
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Miller cautioned that the transition “won’t be a magic bullet for scaling issues on Ethereum,” noting that Australian blockchain businesses will still need to rely on layer-2 solutions like Polygon or Optimism to grow.
That being said, the Merge “will allow the mechanisms to be in place for the network’s scalability improvements to be built,” according to Miller.
“Ethereum provides critical infrastructure for blockchain developers to build and deploy their own decentralized applications and crypto assets. The merge, being potentially one of many changes to the network, will unlock a whole new level of potential for the deployment of these innovations.”
The Merge marks the culmination of several years of hard work from the Ethereum Foundation. The transition didn’t go uncontested; however, as ETHW Core, a group that represents proof-of-work miners, announced that they will be conducting a hard fork within 24 hours of the Merge.