The Ethereum blockchain will soon move away from the proof of work (PoW) consensus mechanism to a proof of stake. That day is now closer than ever. The rollout of Merge, which is what the upgraded blockchain will be called, is ready for liftoff. It has been in the works for years, which makes it one of the most complex projects in the crypto space.
The Transition to Merge
The move will shift Ethereum from a proof of work blockchain to a proof of stake (PoS) blockchain starting on September 15, 2022. In the weeks leading to the Merge, there has been a notable uptick in spot and derivatives betting on Ethereum. Numerous wagers are hinged on its outcome, and many big money traders have invested substantial amounts in their predictions.
Ethereum has achieved several notable milestones. They include the successful merger with the Goerli and Ropston testnets and the merger with the 11 shadow forks. The latest merger with the Shadow forks occurred in August 2022, ahead of the blockchain’s core developers’ meeting. In addition, the final list of Merge-ready clients was revealed on Tuesday, August 23, 2022, via the Ethereum Foundation’s mainnet Merge announcement.
The Merge upgrade will require updates to clients on the Beacon Chain, which is the new PoS layer, the execution layer, and clients that currently run DApps on the exiting proof of Work mainnet.
A Bug in Geth
The Ethereum Community encouraged the growth of multiple developer teams to create client software. Despite encouraging diversity, Geth is the largest developer team today, accounting for 75% of all Ethereum nodes. The rationale for client diversity was vindicated recently when the Geth team discovered a critical bug in a Merge-ready release. After the bug’s discovery, Ether’s price fell by 3%.
The bug was quickly patched and will have no impact on the Merge. However, to ensure everything goes as planned, the Ethereum Foundation launched a turbo-charged bounty program up until September 8, 2022. Up to $1 million has been earmarked for developers that discover a critical bug related to Merge.
The Next Step
On September 6, the Beacon Chain will undergo an upgrade called Bellatrix. This upgrade will activate when the Merge transition on the PoS chain happens. There is no fixed timeline to execute the Merge on the proof of work blockchain. Instead, it will use Terminal Total Difficulty to execute the Merge. This calculation will be used to determine when the Merge occurs. The figure has been set; it places the estimate for the Merge, and it places it at around 1:00 AM on September 15, 2022.
The exact time will fluctuate based on the mining hashrate. However, the impending end of PoW mining on Ethereum has not impacted the hashrate, which has remained at 900-950 Th/s. Miners are incentivized to continue processing transactions until the last PoW transaction on Ethereum. While winding down of mining will occur, it is unlikely to affect the timelines.
What is At Stake?
The design of Ethereum gives developers leeway to delay the Merge if issues arise. After all, $200 billion in valuation is riding on the success of the Merge. However, thus far, it appears everything will go as planned.