The Merge, otherwise known as Ethereum 2.0, is an upgrade that will fundamentally alter how the native tokens are created and operations on the Blockchain take place, will take place. As stated by the Ethereum Foundation, a group that serves as the rep of the network, the new upgraded chain will use 99.95% less energy.
Although the exact time of the Merge is uncertain, it was predicted on September 12 by Google and other websites monitoring the blockchain that it will occur early on Thursday, September 15. According to the Ethereum Foundation, it will happen sometime between the 10th and 20th of this month. The event has already been postponed multiple times.
Ethereum will switch from its current proof of work (PoW) system, should the launch be a success, which relies on energy-guzzling computers to verify transactions by solving difficult mathematical puzzles, to a proof of stake (PoS) mechanism, in which users and organizations act as validators and use Ethereum (ETH) as collateral in an effort to obtain new cryptocurrencies.
As per CoinGecko, Ethereum (ETH) is the second biggest cryptocurrency behind Bitcoin (BTC), having a market cap of almost $200 billion. Per the figures from CoinMetrics, there are roughly 1-1.5 million transactions daily on the Ethereum blockchain as opposed to 200,000 to 300,000 for Bitcoin.
Early in 2022, the price of cryptocurrencies fell precipitously as investors fled riskier investments due to a general decline in the financial markets. Prior to the Merge, Ethereum (ETH) increased by almost 65% in the first 6 month period of the year, whereas Bitcoin (BTC) has barely changed.
Several investors and environmentalists have criticized the excessive energy consumption of cryptocurrency and blockchain technology. As per researcher Digiconomist, a single Ethereum transaction presently consumes as much energy as a typical U.S. home does in a week.
According to supporters, the energy-saving improvement marks a significant advancement in the competition to be the best blockchain in existence.
In the area of decentralized finance, Ethereum has emerged as the preferred blockchain for a variety of tasks, such as smart contracts and initiatives using cryptocurrencies that reflect conventional assets like stocks and other traditional securities.
Supporters of Ethereum claim that the technology will serve as the foundation for a new financial system wherein assets and funds may be traded in the form of digital currencies without the dependence on traditional financial service third-party providers.
Some view it as the foundation of Web3, an expected but not yet realized version of the internet in which blockchain technology and digital assets take the limelight.
Even so, trading is unquestionably the most common application of Ethereum (ETH), which has only recently experienced modest widespread recognition as a form of payment.