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The major financial institutions and organizations that have expressed their concerns and criticism about the blockchain industry have been around for quite some time. While developers have historically strived to better their blockchain-powered creations to match needs while also being good for the planet, it has been a fairly difficult and prolonged journey.
Several groups and affluent individuals have historically slammed cryptocurrencies for the carbon footprint they leave behind in order to operate. However, it is evident that while addressing this issue, it mostly tied around the top two tokens in the entire industry- Bitcoin and Ethereum.
As a foundation that has some sort of control over the course of action, Ethereum has been subjected to a level of scrutiny. The ecosystem had come up with an idea to turn its issues around by incorporating some changes to the network. This was called the Ethereum Merge.
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Ethereum is known to only roll out crucial updates when it is completely ready, and not heeding the negative media attention it gets due to any delay in developments.
This time, however, the network has infact, sped up the Merge, from a previously estimated date of around 15th September to a now officialized 6th September. Clearly, this too had to do with other technical reasons.
What is the Ethereum Merge?
Energy Consumption has been the top issue that Ethereum has been slammed for in the past. This has been a weakness that Ethereum has been hoping to tackle for the last two years. As the number of transactions went up during the 2021 bull run, Ethereum’s energy consumption issue became a mainstream topic that forced them to take immediate action.
Currently, a single transaction on the already congested network requires energy that is enough to power an average U.S home for more than 6 days. With an annual energy consumption of around 78.6 TWh, Ethereum takes up huge amounts of energy while also leaving a massive carbon footprint.
The Merge is expected to create a much greener ecosystem, where the energy consumption of Ethereum might go as low as 99.95% than its current requirement. In order to make this possible, Ethereum has been working for a long time. The idea behind the merge in simple words is to convert its current PoW (Proof of Work) mechanism to a PoS (Proof of Stake) mechanism.
Both of the mechanisms are used to add security to the network and prevent any malpractices. However, PoW consumes a larger amount of energy, making PoS a great alternative. In order to execute this, Ethereum’s mainnet is shall be merged(starting on 6th Sept) with Beacon Chain, which is a Proof of Stake consensus layer.
The terminal total difficulty, which implies the total difficulty within the network shall be at 58750000000000000000000, which shall trigger the merge. The exact date for when the merge will occur has not been specified, as it will be subject to the proof of work hash rate at the specified time, which is between Sept 10-20.
Thus, the entire process is set to be carried out in two stages. Phase 1 is called Bellatrix, which is on 6th Sept. Phase 2, called Paris shall take place during the aforementioned dates, post which the Network will have successfully transitioned to PoS or Proof of Stake.
About Ethereum
Founded in 2015, Ethereum is a decentralized open-source blockchain which features a smart contract functionality. It was the brainchild of Vitalik Buterin, who created the platform as a solution to an issue he wasn’t happy about in a game. Since then, the project has grown to reach its current position as the 2nd biggest cryptocurrency in the world.
Ethereum has positioned itself as one of the most important assets within the blockchain ecosystem and hosts more than 3000 dApps within itself. The native token ETH, which is also commonly referred to as Ethereum, was one of the fastest growing cryptocurrencies in the space since its inception.
At the time of writing, ETH is trading at around $1,681, after a major correction in 2021 from its all-time high of around $4,750. However, there has been positive price action whenever Ethereum announced a major development.
Several investors have been speculating for the tokens price to increase as the Merge takes place. It may also be possible for major altcoins revolving around Ethereum’s functionality to get a boost in prices.
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