Ethereum Merge: What To Expect and How To Prepare
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Loading... - Rehema Abbas
- 22 Sep 2022
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The mythical merge is finally coming to fruition. And, after a rough-and-tumble year for the crypto world, Ethereum’s long-awaited software update could inject some much-needed energy into the Web3 space while scoring a significant win for the environment.
The transition, years in the making, is technically sophisticated, controversial, and likely to be the biggest event in the crypto space for some time to come. So, let’s break down what the merge is, why it’s essential, and what it means for the future of the crypto and NFT space.
What exactly is the merge?
The Ethereum blockchain is the technical infrastructure that allows countless Web3 applications and crypto and NFT projects to exist. At its most basic level, the merge (sometimes called Ethereum 2.0, Eth 2, or ETH 2.0) is an upgrade to the Ethereum blockchain that will reduce its environmental impact, increase security in the network, and enable Ethereum developers to introduce new features and increase the scalability of the chain.
So, what’s merging, exactly? The update will combine the Ethereum mainnet (blockchain) with the Beacon Chain, a separate blockchain created in 2020 that has since been running in parallel with Ethereum.
The Ethereum mainnet is what developers call the execution layer in the blockchain network. Execution layers create a place for applications to live and process transactions that relate to those applications. You can think of this as the engineering that allows for data transfers on the blockchain to take place. Execution layers give you the power to conduct a transaction.
The Beacon Chain is the consensus layer in the system. The secret’s in the name — this layer deals with network rule enforcement, validating (or invalidating) transactions that “want” to occur in the execution layer. Because blockchains are essentially decentralized public ledgers, they need a way to verify or invalidate the transactions taking place within them.
To do this while also ensuring that nobody forges a transaction on that public ledger and steals cryptocurrencies or NFTs that don’t belong to them, most computers in the system have to agree on the transaction’s (block’s) validity. This is how a blockchain governs itself without third parties.
Right now, the Ethereum mainnet uses a system called Proof of Work to validate transactions. Merging with the Beacon Chain will allow Ethereum to end its PoW consensus system in favor of another system called Proof of Stake. And that’s a huge deal. Read More...
