Web3 technology is still in its infancy, with new developments appearing throughout the world every single day of the week. BIG events occasionally occur, and they frequently demand the community’s full attention. When will the world’s first smart contract-based, DeFi-ridden, Layer 1 blockchain officially merge? With all test-net upgrades now complete, the Ethereum Merge is a big subject this month. The updated PoS consensus method will be added to the network this month, however, the Ethereum Foundation did not specify a specific day or time. The integration is anticipated to be finished “between September 10 and September 20th.
- 1 What is Ethereum doing exactly?
What is Ethereum doing exactly?
Ethereum, the first blockchain network for smart contracts, will undergo a makeover. This mostly affects network developers and node operators. There won’t be any direct participation from regular Ether users or owners in this event. The Bitcoin network is based on a consensus model called proof-of-work, which validates transactions and keeps the network secure. There has been discussion of converting Ethereum to a PoS, or proof-of-stake, work for several months and years. Since proof-of-work mining consumes a lot of electricity, switching Ethereum to proof-of-stake will improve the network’s energy efficiency. The Merge is “a truly exciting step in realizing the Ethereum vision – more scalability, security, and sustainability,” according to the source. “The Merge represents the joining of the existing execution layer of Ethereum (the Mainnet we use today) with its new proof-of-stake consensus layer, the Beacon Chain.”
How Safe Is Your Ether (ETH)?
A blockchain network upgrade is comparable to upgrading a PC from Windows 10 to Windows 11. The data and files are completely unaffected, but the operating system’s backend functionality and frontend design are updated. To answer your query, the blockchain will keep your Ether secure. To spare customers from needless danger, exchanges are going to suspend all Ethereum transactions for the 12 minutes it will take the merge to be completed. Will con artists continue to try to mislead and harm users who lack education? Yes, they excel at doing that. Therefore, it is wise to always err on the side of caution when using dubious websites or online services like email and hot wallets.
Will the merger have an impact on NFTs?
This query has a two-part solution. On the blockchain, NFTs act as distinctive value tokens, on the one hand. After the main net updates, NFTs will be safe, just like Ether is. In reality, there is no requirement for investors or end users to take any action to “safeguard” their assets before the merger. You may be sure that your prized Moonbirds, Cryptopunks, or Bored Apes will continue to maintain their prestige levels. On the other hand, finding the opposite of that answer involves determining whether the network will fork after the merge. If this occurs, there may be two NFTs, or copies, on the market, with only one being the genuine token.
Ethereum: Will it split?
Not all Ethereum players support the merge; some prefer to keep the proof-of-work consensus method in place and do not want the chain to switch to proof-of-stake. As a result, they intend to hard fork the network. Like Bitcoin and Bitcoin Cash, Ethereum and Ethereum Classic, Ethereum may fork, effectively forcing the Ethereum mainnet to split into two distinct chains. Duplicate NFTs could generate some confusion in the market if the network does fork and a chain similar to ETHPOW is created. However, the misunderstanding would pass quickly as multiple apps and NFT marketplaces would put the real proof-of-stake Ethereum blockchain at the top of the food chain, gradually weeding out the bad guys.
Could centralization of validators be a problem?
As mining will no longer be a meaningful term in the updated network, validators will take the place of miners with the transition to proof-of-stake. In essence, the more ETH a person or organization holds, the more influence they have over the network’s future direction and decisions. Not to mention, they can validate transactions with a significant stake to earn even more ETH. Because they are aware of this, exchanges and other businesses actively encourage investors to stake ETH on their platforms. Currently, more than 65% of all ETH staked is provided by big corporations like Kraken, Coinbase, Lido, and Binance. The big staking pools will probably keep the network relatively stable even though they may not contribute well to the overall “decentralization of crypto” element. Not to add, as more validators enter the scene, the network will gradually become more decentralized.
After the merger, will Ethereum be all right?
The same goes for network updates; faults are inevitable. You may be sure that the Ethereum developer community is full of smart and notable people who will swiftly fix any potential issues to enable a smooth switch to proof-of-stake. Ethereum is essential for the majority of NFTs, DeFi-related apps, and Layer-2 scaling protocols to function. Ethereum is here to stay. In actuality, the transition is only getting started with this upgrade to proof-of-stake. Since no new tokens, such as ETH 2.0 tokens, will be produced, the Ethereum ecosystem’s existing tokens will remain unchanged. Be wary of con artists that attempt to trick you into purchasing or exchanging for such things. According to Ethereum.org, “The Merge is the most important upgrade in Ethereum history. Extensive testing and bug bounties were conducted to ensure a safe transition to proof-of-stake.”
Author: Francesco La Rocca
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