Tim Beiko pointed to September 19 as the “provisional date” for Ethereum Merge activation on the Ethereum mainnet. The developers are putting the finishing touches on the highly anticipated upgrade that will put an end to Ethereum PoW mining.
Ethereum Merge upgrade coming soon
As we reported on Kriptokoin.com, Ethereum is moving from a proof-of-work (PoW) consensus to a proof-of-stake (PoS) consensus with the “Ethereum Merge” upgrade. This upgrade is set to make the Ethereum network more efficient, inclusive and environmentally friendly. Merge is important to the Ethereum blockchain and the Web3 ecosystem as a whole for the following reasons:
- Merge will replace the PoW consensus with a PoS consensus where Ethereum network integrity will be secured by investors rather than miners.
- It is a first in crypto history for a mainstream protocol to radically change the consensus design.
- The developers have already enabled Ethereum Merge on the Hive and Sepolia testnets. So the Goerli activation will be a final rehearsal before the mainnet.
- Proof-of-stake (PoS) consumes less energy. Thus, it reduces the carbon footprint of a network and makes it more decentralized;
- Once Ethereum proof-of-stake is released, the move towards sharding will be the next step.
Ethereum’s proof-of-stake specifications were first announced more than two years ago.
What is Ethereum?
Ethereum is the first blockchain with smart contract support. ETH launched on the mainnet in July 2015. Vitalik Buterin and Gavin Wood are the best known of the ETH creators. It aimed to address the main problems of Ethereum, Bitcoin and other cryptocurrencies. Bitcoin, Litecoin, XRP, and all first-generation cryptocurrencies were only eligible for value transfer. Ethereum established itself as a general purpose decentralized computer.
Its smart contracts are used in thousands of decentralized applications. (decentralized finance (DeFi) protocols, markets for NFTs, blockchain-based games, etc.) Ethereum’s native cryptocurrency is ETH. ETH is the largest altcoin. Only Bitcoin (BTC) surpasses it by market cap.
What is Proof of stake?
Proof of stake (PoS) is a class of blockchain consensus algorithms where validators vote on the next block before adding it to the chain. Therefore, POS is considered an improvement over the proof-of-work algorithm, thanks to its resource efficiency, environmental friendliness and decentralized parameters. There is no need to purchase expensive mining equipment to participate in staking. There are also chain-based and BFT-based proof-of-stake (PoS) systems. However, Proof-of-stake systems rely on their investors in their operations.
As of Q2 2022, Ethereum’s competitor Cardano (ADA) is the largest proof-of-stake system. .
Ethereum Merge basics
Merge is the procedure that combines the existing Ethereum transaction execution layer with the Beacon Chain as the new consensus layer. Currently, the ecosystem of Proof of Work (PoW) miners is a consensus layer. Beacon Chain solves this problem. Thus, the developers are incorporating the Beacon Chain with Deposit Contract into the Ethereum (ETH) mainnet.
Beacon Chain, account balances, transactions, etc. will be responsible for the processing of all network data, including Beacon Chain is becoming the engine of block production. Proof-of-stake validators will be responsible for processing the validity of all transactions and recommending blocks. At the same time, the new system will preserve the entire transaction history of the old Ethereum (ETH).
Ethereum Merge: Testnets
To ensure a smooth transition to the Testnet Proof-of-stake (PoS) consensus, Merge has enabled Ethereum (ETH) core developers The Coming on a series of closed and public testnets. Also, since December 2021, Ethereum (ETH) enthusiasts have mimicked The Merge specifications on the Kintsugi and Kiln purpose testnets.
However, in Q1 of 2022, they allowed developers to spot sync issues and put some finishing touches to the post-Merge codebase. Like when testing Merge, the developers tried a brand new “shadow fork” mechanism. In 2022, Ethereum enabled Merge on public testnets in Ropsten and Sepolia.
Ethereum Merge timeline
Here is a timeline of the most important milestones on Ethereum’s path to Merge:
- June 30, 2015: Ethereum (ETH) launched on the main net on proof-of-work consensus;
- Q2 2019: Ethereum (ETH) developers recommend Casper as a high-end application for how blockchain can transition to proof-of-stake (PoS).
- Early March 2020: Vitalik Buterin, together with co-authors, released GASPER, a more advanced implementation of Beacon Chain.
- November 20, 2020: Ethereum 2.0 Deposit Contract launched with a minimum investment of 32 ETH.
- December 1, 2020: Beacon Chain is launched as a parallel network to Ethereum’s (ETH) mainnet.
- October 28, 2021: Beacon Chain undergoes Altair upgrade. Also, the ETH price has risen to an all-time high.
- 2022 Q1: Ethereum (ETH), Kintsugi and Kiln implemented Merge on testnets, “shadow forks” enabled;
- June-July 2022: Ethereum (ETH) Merge enabled on public testnets in Ropsten and Sepolia;
- July 15, 2022: Integration activation on mainnet is tentatively scheduled mid-September by coordinator Tim Beiko.
What steps will be taken after Merge?
Once the Merge upgrade is live on the main net and working on PoS, the Shanghai update will be the first hard fork in the new consensus. Shanghai will change some aspects of UX/UI. It will also upgrade EVM and reduce gas costs for end users. Additionally, native execution of BLS transactions by the Ethereum Virtual Machine will be added.
Ethereum will likely enable sharding in the coming months. The blockchain will be divided into a network of parts or interconnected sub-chains. Unlike NEAR Protocol and Harmony, this update will improve the performance and throughput of the Ethereum mainnet.
Will Merge affect Ethereum price?
Merge is the most radical upgrade for Ethereum tokenomics. Also, many ETH holders and potential investors are wondering if it will affect the price of ETH. However, every major boost is a strong short-term catalyst for altcoins’ prices.
With Ethereum’s transition to proof-of-stake, ETH holders will be encouraged to lock their investments for staking. Ultimately, this will significantly reduce the selling pressure.
4290
