After eight years of delays the Ethereum blockchain has moved to Proof of Stake, a new way of verifying transactions after eight years. It was called the “merge” and completed by Thursday morning. This significantly lowers energy consumption and opens the door for Ethereum to reduce its fees and vastly increase its user base.
“It’s hard to compare it to the genesis day in 2015, but it may end up being more significant,” says Joe Lubin, a co-founder of Ethereum and the founder of the blockchain company Consensys. “It basically takes us into an infinite-transaction-per-second throughput architecture…It’s about to go internet-scale.”
Learn More: What is the Ethereum Merge?
While varying experts and speculators predicted that the merge would either send the price of Ether skyrocketing or tumbling, prices stayed relatively flat during Asia’s trading day.
The merge’s success (thus far) serves as an ideological victory for Ethereum and its decentralized structure. Instead of a board or CEO, the network is made up of a number of engineers and developers scattered around the globe. Leadershipless collaboration is the core principle behind blockchains. Ethereum developers demonstrated their capacity to self-organize over many years and push for a hugely technical update.
The merge was designed so that Ethereum users themselves don’t need to do anything: their accounts will update automatically. Many scams have proliferated over the last few months online that prompt holders of Ether to “upgrade” their software, when they are really just trying to steal funds. Developers indicated that Thursday’s merge was complete. produced fewIf anyMajor bugs
This decision was welcomed by environmentalists. Ethereum’s previous method of securing the blockchain, known as Proof of Work, uses a massive amount of energy: Last week, the White House released a report on crypto’s environmental impact, saying that crypto-asset activity in the U.S. compares to the country’s greenhouse gas emissions from railroad diesel fuel. A switch to Proof of Stake, the report goes on to say, could “dramatically reduce overall power usage to less than 1% of today’s levels.”
Beeple, perhaps the most famous NFT artist of all time, recognized the merging in an artwork.
This transition has been a disaster for Proof of Work miners, who were consuming large amounts of energy by running huge data centers. They’ve invested in equipment that is now useless. Some of the miners created their own token, ETHW. It still uses Proof of Work. Although most Ethereum users have rejected this alternative blockchain’s legitimacy, some traders still wanted to profit from the transaction. That token’s price doubled in value shortly after the merge, before plummeting all the way back down again.
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