The Merge: what it is, how to prepare and how it affects those who have Ethereum
The transformation process of the Ethereum network will occur between September 6 and 12; what operations will be suspended on the most important platform in the crypto world
Yesterday the last update phase of the Ethereum network was activated before "The Merge" occurs, between September 13 and 15. This stage consisted of the “Bellatrix phase”, which will launch the merger process, with the update of the node operators.
“The merger is still expected to happen around September 13-15. What is happening today is Bellatrix's hard fork, which prepares the chain for the merger. However, it is still important: make sure to update your clients!” Vitalik Buterin, founder of Ethereum, expressed.
Ethereum, the blockchain network that creates the second cryptocurrency among those with the largest market capitalization, will go through one of the most important evolution processes in the crypto world since its existence. “The Merge”, as it was called, will imply reforms regarding how transactions are carried out, applications are created, smart contracts are issued and ETHs are generated. The changes aim to make the network cheaper, more scalable and more environmentally friendly.
These transformations will occur in stages between September 6 and 20. One of the most relevant novelties has to do with the change from a Proof of Work (PoW) protocol to Proof of Stake. “Currently, each operation in the network – suppose, the sending of an amount of ether from one person to another in one of the job portals that pay with cryptocurrencies – requires the participation and consensus of distributed nodes (computing units). , which certify and record the transaction in a block chain using mathematical exercises and a lot of computational power”.
This “consensus form” is the one used by, for example, bitcoin. On the other hand, as of “The Merge”, ethereum will no longer be “mined” and there will begin to be “validators” in charge of registering operations. Advances have shown that this system consumes less electrical energy - and therefore reduces the carbon footprint - and is superior in terms of preventing hacking, fraud or duplication. In addition, it promotes the decentralization of the system, an objective of special relevance for the crypto world.
This change will imply a more scalable network. “The consensus protocol that Ethereum is about to adopt promises faster transactions and more agile processes. It will be easier for the network to summon the vast participation of validators compared to the current effort that involves integrating more and more miners; this should be reflected in the growth of the network and its uses”.
What can happen with Ethereum?
Major exchanges expect to make announcements about how “The Merge” will impact the various products on the network after the process occurs. This is because some of the consequences of the merger are unknown, or could lead to different outcomes.
Ethereum could be divided into two different networks, something known as a "fork". In that case, ETH (the acronym that currently identifies the network's tokens) will refer to the new chain. That token, however, will have to go through a listing process to be published on some platforms.
After the update, it is very likely that the speed of the transactions will be similar to the current one. The changes will not be noticeable to the average user. Ethereum gas fees will remain the same for now, but there is a possibility that they will be cheaper in the future.
Instead of miners, people who stake Ethereum will help protect the network. Stakers will not be able to withdraw their staked Ethereum for six to 12 months after “The Merge.”
How to prepare?
In principle, the holders and users of the Ethereum network should not do anything, although they should be alert to the suspension of some services in the network until the merger occurs. Liquidations will continue to be enabled under extreme conditions of price volatility.
Proof of Work, the algorithm that bitcoin currently uses and from which ethereum will migrate, has some disadvantages, such as the consumption of electrical energy. From now on, the tokens will not be mined, but there will be validators in charge of registering the operations in the blockchain, a more decentralized system.