The Merge project has finished the switch to proof-of-stake as the primary way for the network to make decisions by combining Ethereum’s original execution layer with its newly developed proof-of-stake consensus layer.
Used to be called Ethereum 2.0, the Ethereum consensus layer is now a whole part of the original blockchain (execution layer). The Merge went well and was finished on September 15, 2022. This was the beginning of the change from proof-of-work (PoW) to proof-of-stake on the Ethereum network (PoS). The network says that The Merge has cut Ethereum’s overall energy use by about 99.5%.
During the Merge, Ethereum’s old execution layer, also called the mainnet, joined with its new PoS consensus layer, the Beacon Chain. This was a significant technological step forward. The first step in Ethereum’s plan to grow is the Merge. “The Surge,” “The Verge,” “The Purge,” and “The Splurge” are the names of the next steps. The Merge is just the start of how Ethereum will grow.
The second significant change when the network switched to PoS was that validators got less ether (ETH) to keep the network running. This gave ether a value that goes down when prices go up.
At the moment, the only kind of deposit that can be made into Ethereum’s staking system can’t be taken out. At the moment, ETH worth billions of dollars are being bet on the network, and it will stay there until the developers of Ethereum add a way to get it back.
What will people who mine Ethereum have to do after the Merge?
Since the beginning, the Ethereum mainnet has used the proof-of-work method. This means that miners always check the transactions on the blockchain to ensure they are correct. The proof-of-stake layer of Ethereum is called Beacon Chain.
There are people whose job is to put together transactions and people whose job is to check each one. Whether a builder or a validator can choose blocks or make sure they are correct depends on how much bitcoin they have.
About 95% of the GPU power that could be used to mine was on the network in the past. So, miners could check transactions and get paid for doing so. When a validator’s bitcoins are at stake, they are less likely to do bad things.
What could go wrong, and what are the risks with the Ethereum merge?
One of the scary things about the Merge is that it could give more power to fewer people. Most people don’t know how Merge works, so they could be taken in by a scam.
One of the most fundamental problems with the Merge is that it will likely make the network’s power more concentrated. When a stalker verifies a block, they will get more money if their position is more valuable. This could lead to a small group of wealthy people or organizations controlling most of the stake and having too much power over the network.
The network shares are run by five main groups that control 64% of the network. If a fork is controversial, these groups might decide which chain to back by working together.
This could make it impossible to make a transaction or cause the same amount of money to be spent twice. Skeptics are already wondering if the Merge is just a way for the rich to get richer and have more control over the people who are already involved.
If staking becomes a requirement, people who don’t have enough money to stake their ETH holdings to earn interest on them may be priced out of the market. This means that only people with a lot of money would be able to participate in the staking process, which could lead to even more centralization. For investment and trading use platform like this trading platform.
Scammers often use significant changes like The Merge to make people think they need to do something (usually give up tokens) to get to the next platform level. Users could be tricked into downloading malware by making it look like an official update to the wallet. This kind of trick could also be used by con artists. People can be tricked into thinking they need a new wallet. Miners working on Ethereum’s mainnet for a long time may keep working on Ethereum’s old chain instead.