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Ethereum

What is The Merge? An Overview of Ethereum’s Transition from Proof-of Work to Proof-of Stake

What Is The Merge? A Brief Explanation of Ethereum’s Transition From Proof-of-Work to Proof-of-Stake

In 23 days the Ethereum network will transition to a proof-of-stake (PoS) consensus algorithm after operating as a proof-of-work (PoW) blockchain since July 30, 2015. Although the changes may not be significant to traders and users of ethereum, they are very important.

You’ve heard about the Merge. Why is it a big deal?

The next month will be a significant time for the Ethereum network, and all its participants. The Merge is likely to be one of most anticipated and well-known upgrades since the DAO hard fork. On or around September 15, 2022, Ethereum will implement The Merge and that means the chain will completely change the consensus mechanism it once used. Since the creation of Ethereum’s blockchain, Ethereum’s consensus scheme has been a proof–of-work (PoW), similar to Bitcoin’s.

However, instead of the PoW consensus mechanism SHA256, Ethereum relies on a scheme called Ethash, a PoW consensus agreement preceded by a mechanism known as Dagger-Hashimoto. The main goal of Ethash was to offer ASIC resistance but after a few years, Ethash ASIC miners appeared on the market alongside the use of graphics processing units (GPUs). Ethash miners must submit the computational cost of operating and purchasing ASIC or GPU mining equipment, as well as electricity. This is similar to Bitcoin’s PoW consensus algorithm.

What Is The Merge? A Brief Explanation of Ethereum’s Transition From Proof-of-Work to Proof-of-Stake

Ethereum won’t rely on miners to validate transactions when The Merge occurs. Validators will validate the transactions of the network. By using a PoS consensus mechanism, Ethereum validators are selected by owning 32 ether and they are required to run three different pieces of software which include a validator, an execution client, and a consensus client. At the time of writing, 13,406,821 ETH has been added to the Ethereum 2.0 contract and there are more than 416,000 validators.

The Ethereum blockchain has been aiming to become a PoS Chain for many years. The Ethereum Foundation provides six different reasons why PoS is an improvement and one of the most talked about is “better energy efficiency.” The Ethereum Foundation’s summary of ETH‘s transition to PoS also says that the consensus mechanism provides “lower barriers to entry” because of “reduced hardware requirements” and “there is no need for elite hardware to stand a chance of creating new blocks.”

Ethereum proof-of-work miners with ASICs or GPUs will need to mine another cryptocurrency asset that leverages Ethash. There are only a few available today. You can choose to mine ethereum classic or ravencoin. A few days ago, on August 20, 2022, Ethereum Classic’s hashrate reached an all-time high. Ethereum (ETH) will follow a new set of consensus rules and mining ethereum with a machine will be obsolete. Although the PoS topic is a hot topic, the progress towards achieving the goal has been very successful.

Currently, Ethereum has a PoS chain called Beacon that runs in parallel to the PoW blockchain network. The Merge has been safely docked by developers with the three major testnets, Ropsten, Sepolia and Goerli. Nine shadow forks have been completed. The Merge will be executed on Ethereum’s main network on or around September 15, 2022, or when the total difficulty reaches 58750000000000000000000. The network will then merge with the PoS consensus mechanism applied to the Beacon chains and the testnets Ropsten and Sepolia.

What do you think about Ethereum changing its consensus mechanism to PoS from PoW?

What do you think about Ethereum changing its consensus mechanism to PoS from PoW?

Jamie Redman

Jamie Redman, the News Lead at Bitcoin.com News, is a Florida-based financial journalist. Redman has been an active member of the cryptocurrency community since 2011. Redman is passionate about Bitcoin, open-source codes, and decentralized applications. Since September 2015, Redman has written more than 5,700 articles for Bitcoin.com News about the disruptive protocols emerging today.

Image Credits: Shutterstock, Pixabay, Wiki Commons

Disclaimer: This article is for informational purposes only. This article is not intended to be a solicitation or offer to buy or sell any products or services. Bitcoin.com does not provide investment, tax, legal, or accounting advice. The author and the company are not responsible for any loss or damage resulting from or in connection to the content, goods, or services discussed in this article.

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Ethereum

Arthur Hayes Says Cardano Is A ‘Shitcoin’ – Here’s Why

Cardano (ADA) is a “shitcoin” without purpose that has no distinct advantage over competitors, according to BitMEX co-founder Arthur Hayes.

“Who gives a fuck? Zero?” said Hayes when asked “What about Cardano?” in an interview with Coin Bureau published on Sunday.

Cardano Is A Shitcoin, Says Hayes

Continuing to describe the cryptocurrency – a top ten digital asset by market cap – Hayes did not mince words: “The first wannabe Ethereum, and probably the first one to go to be irrelevant,” he said.

Typically, the popular crypto essayist and trader is well known as one of the loudest long-term Bitcoin (BTC) and Ethereum (ETH) bulls, and often expresses interest in small-cap cryptos for short-term trading.

During the same interview, Hayes even expressed interest in the memecoin “dogwifhat” calling it the “best dog money of this bull cycle.

“I love Rare Pepe’s… I think we’re going to see a resurgence of NFT trading volumes,” he added.

The writer’s unique callout of Cardano ruffled some feathers online – especially with the network’s founder, Charles Hoskinson. On Tuesday, Hoskinson asked Hayes why he was “throwing shade” at Cardano.

“Cause your coin is a piece of shit man,” Hayes replied. “Just buy some ETH and chill.”

What Makes Cardano Unique?

Much like Ethereum, Cardano is a smart contract platform for developing decentralized applications. It also popularized as one of the first well-developed proof-of-stake cryptocurrencies, which use crypto rather than energy to secure its network.

However, many popular blockchains today now use the same mechanism, with Ethereum undergoing a massive upgrade in 2022 to adopt proof of stake. In terms of both market size and DeFi TVL, Cardano is still outsized by competitors like Ethereum, Solana, and Binance Smart Chain (BSC).

On Tuesday, Hayes published a list of the world’s most popular Dapps, and asked which of them had originated or grown most popular on the Cardano blockchain.

“From my very limited knowledge, it looks like none of them do,” he said. “That’s why ADA is dog shit.”

On Bitcoin, however, Hayes remains a bull, expecting strong money printing from the Federal Reserve to drive the asset’s price up soon.

“When printing money happens and you debase the value of time and human labor, we rejoice and say great, fuck you, we’re gonna take Bitcoin to a million,” he told Coin Bureau.

Late last year, Hayes predicted that Bitcoin would reach between $750,000 and $1 million by the end of 2026.

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Ethereum

Crypto Markets Experience Minor Setback as Major Coins Dip, While Select Tokens Buck the Trend

On Wednesday, the crypto market experienced a modest downturn, with a 1% decrease in its overall value across the board, as bitcoin and ethereum saw declines of 0.51% and 0.45%, respectively. Bitcoin momentarily reached the $53,000 mark the day prior, while ether soared past the $3,000 threshold on Tuesday…
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Ethereum

Ethereum Technical Analysis: ETH Highlights Resilience Across Several Timeframes

Ethereum started Monday with its price hitting $2,934 per unit, marking a week filled with a strong 14.9% increase. Over the preceding fortnight, the second-leading crypto asset by market cap witnessed a substantial 25.9% upswing. Kicking off this week, ether’s trading volume over the past 24 hours has hovered around $24.74 billion…
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