Ethereum merger – All you need to know about biggest blockchain migration undergoing now

#Ethereum is moving from #PoW (Proof of work) to #PoS (Proof of Stake), within few hours Ethereum mainnet will merge Beacon Chain proof of stake system. This will be the end of Proof of Work Ethereum and full transition to proof of stake. #EthereumMerge

Ethereum is the most popular decentralized, open source smart contract network.?Ethereum supports many use case in the journey towards making word decenterlized. Some of the key user cases includes,

DeFi – Decentralize finance ?

Digital Identify

Payments

Storage solutions

?NFTs – Non-fungible tokens

Decentralize social media

Also Ethereum is the native block for multiple domain such as,

Data & analytics ?(Ex – CoinGecko )

Cross Chain ( Ex- REN)

Insurance

Derivatives (Ex – Synthetix)

Asset management

Trading (Ex – Unisawap)

Lending (Ex- AAvae )

Stable coins (Ex – USDC)

Oracles ( Ex – Chainlink)

Custody – ( Ex - Metamask) ?

What is Etherum merger?

Etherum is moving from PoW ( Proof of Work ) to PoS ( Proof of stake)?consensus mechanism.

What is Proof of Work (PoW)

Proof of work (PoW) is a form of adding new blocks of transactions to a blockchain. Miners compete with each other to win the right to update the blockchain and receive rewards.

What is Proof of Stake (PoS)

Proof of stake is a blockchain consensus mechanism used to archive distributed consensus when adding a new blockchain transactions to blockchain.?

Difference between PoW vs PoS?

Probability of mining – PoW depend on miner computational power while PoS depend on how large of stake a miner hold (Dishonest miners will get penalize in case of any issues to keep the blockchain secure)

Rewards – PoW, rewards given to first miner who solve the cryptographic puzzle while in PoS validators receive the block chain fees for their work

Adding new block to blockchain – PoW miner has to solve the complex puzzle competing with other miners while PoS there is no competition and creator is selected by algorithm base on miner stake.

Security -?PoW, hackers need 51% of computation power to add malicious blocks while in PoS, hackers need to own 51% of stake on network (which is far more impossible )

So what’s will happen to Ethereum after merger?

99.99% less energy use due to moving to PoS. 90% of cut in emissions and deflationary with EIP 1559 (related to gas or transaction fees) and finally better economics compared to PoW.

When is Ethereum merger is happening and what is the latest status?

This merger has been postpone multiple times and there is high profile visibility now since Ethereum developers are finally closed to finish this off.?There is no exact time and merger will get completed by 14th or 15th September.?The merger is not kicked on big band instead schedule to take effort once the cumulative difficulty of all mined Ethereum blocks hits certain number ( the total terminal difficulty – TTD)

Big question – will it reduce instance Ethereum gas fees?

Unfortunately NO. it’s unlikely to reduce transaction fees but this will allow future Ethereum developer to work on new innovations to reduce gas fees.