It's finally happening, guys.
The Web3 & Crypto world was shocked to discover that the Ethereum Merge is happening.
This upcoming upgrade could revolutionize Blockchain technology and shake everything we know from its core.
In fact, we could be witnessing a long-waited evolution from the world's most popular Crypto platform to becoming more environmentally friendly and sustainable.
And we'll tell you all about it in the next 4 to 5 minutes.
So, sit tight, pay attention, and let's get started with a quick overview of what we're facing.
Before we start talking about the Ethereum Merge, let's begin with a few facts to set some precedents:
Ethereum, according to Ethereum.org, is:
"...a technology for building apps and organizations, holding assets, transacting and communicating without being controlled by a central authority. There is no need to hand over all your personal details to use Ethereum - you keep control of your own data and what is being shared. Ethereum has its own cryptocurrency, Ether, used to pay for certain activities on the Ethereum network."
For the sake of clarity, it's important to mention that Ether (ETH) is the native cryptocurrency of this Blockchain technology program.
But how's Ethereum any different than Bitcoin?
According to Ethereum.org:
"Launched in 2015, Ethereum builds on Bitcoin's innovation, with some significant differences.
Both let you use digital money without payment providers or banks. But Ethereum is programmable, so you can also build and deploy decentralized applications on its network.
Ethereum being programmable means that you can build apps that use the Blockchain to store data or control what your app can do. This results in a general-purpose blockchain that can be programmed to do anything. There is no limit to what Ethereum can do, so it allows for great innovation to happen on the Ethereum network.
While Bitcoin is only a payment network, Ethereum is more like a marketplace of financial services, games, social networks, and other apps that respect your privacy and cannot censor you."
Now that we have this information, let's talk about the Ethereum Merge.
The Ethereum Merge is, in a few words, a long-waited upgrade to the Ethereum system.
Quoting a NY Times article from August 2022, the Ethereum Merge could be defined as:
"At its core, the Merge is a change to Ethereum's verification system. When someone sends money in a traditional transaction, a bank serves as the middleman, verifying that one person has sufficient funds to pay someone else.
Crypto operates without that middleman. In this alternate financial system, transactions are verified by a scattered network of computers. Anyone can plug a machine into the network by running software that solves complex puzzles, an energy-guzzling process for confirming transactions. The computers are racing one another: When the mystery is solved, the winning participants are rewarded with new coins in the digital currency they are verifying.
This verification process is widely known as crypto mining and has the technical name "proof of work." By some estimates, the amount of energy consumed each year in mining is comparable to the annual emissions of entire countries."
This means that the Ethereum Merge will arrive to solve two main issues for the Crypto community:
One is the Proof of Work model…
And the other one is the energy consumption related to Blockchain technology.
We'll get here in a few paragraphs. Still, it's worth mentioning that this Merge (taking place in September 2022) will significantly decrease the energy consumption, switching from a Proof of Work model to a Proof of Stake model.
Yeah, sorry about that.
Let us explain precisely what this means:
Proof of Work and Proof of Stake are the two central consensus mechanisms that Crypto use to verify transactions. Then, they get added to the Blockchain and create tokens from it.
Proof of Work is the oldest of these two, and it's used for Bitcoin, Ethereum 1.0, and many more. According to Coinbase, it could be defined as:
"...the original crypto consensus mechanism, first used by Bitcoin. Proof of work and mining are closely related ideas. The reason it's called "proof of work" is that the network requires a huge amount of processing power. Proof-of-work blockchains are secured and verified by virtual miners around the world racing to be the first to solve a math puzzle. The winner gets to update the Blockchain with the latest verified transactions and is rewarded by the network with a predetermined amount of Crypto."
Now, Proof of Stake, employed by Cardano and the newest Ethereum 2.0, is:
"In a proof of stake system, staking serves a similar function to proof of work's mining, in that it's the process by which a network participant gets selected to add the latest batch of transactions to the Blockchain and earn some crypto in exchange.
The exact details vary by project, but in general proof of stake blockchains employ a network of "validators" who contribute — or "stake" — their own Crypto in exchange for a chance to validate a new transaction, update the Blockchain, and earn a reward.
Energetic waste, mainly. But there's a clear intention of systematically optimizing transactions, making them faster and more efficient.
Just like Money.com says:
"Proponents say that the transition will allow the Ethereum network to reduce its energy consumption by around 99%.
The proof-of-work model, which the Bitcoin network uses, requires far more energy than the proof-of-stake model. The negative impact on the environment of crypto transactions has been top of mind for many cryptocurrency critics and advocates alike. Ethereum's shift to the less-energy-intensive proof-of-stake is viewed as a significant advance.
It will also set the groundwork for other aspects of the network's roadmap, like making transactions more efficient."
That, without mentioning that Ethereum developers will have even more room for introducing new features to the network.
According to a recent Ethereum.org blog post, Ethereum's Merge is set to happen next September 15, 2022, while official development is taking place this September 6, 2022.
There will be. Even more, the Web3 community relies heavily on Ethereum technology. But don't let panic hit that hard.
Because when push comes to shove…
Spark + Mint will be there to give you the most recent updates on anything Ethereum, Web3, Crypto, or even the Merge's final outcome.
So, to learn more about these topics or anything else, you must tune in to our Podcast! Just click the link below and enjoy!
Got any recommendations, or want to learn more about anything in particular?
Just hit us up, and we'll get your questions answered in the next episode.
Again, thanks for reading, and see you next time!
- The Spark + Mint Team