It’s been a difficult year for crypto, but the Ethereum Merge just around the corner has offered some semblance of a positive narrative for the crypto sector in the midst of suffocating macro-economic factors, even driving a small recent rally in the charts, according to some analysts.
A mid-September date (between 10-20 September) for the historic event has been announced, which will see it transform into an environmentally-friendly and more scalable network. The upcoming Bellatrix and Paris upgrades are set to make this long-awaited piece of crypto history a reality, and will end a process that has been in the planning for several years and gone through multiple delays.
With only roughly 2 weeks to go though, there are still many variables up in the air. Despite several successful testnet upgrades, will the Merge go without a hitch? Will there be a hard fork, as some have predicted? With only two upgrades left until Ethereum’s transformative moment, it’s a great time for another round-up, where we take stock of the situation and what we can expect for the world’s oldest smart contract chain in the months to come.
What Is the Ethereum Merge?
The Merge is when the Ethereum blockchain will switch from the older proof-of-work (PoW) model pioneered by Bitcoin to the newer proof-of-stake (PoS) consensus mechanism used by chains like Solana and Cardano.
Ethereum’s Beacon Chain, which has been successfully running on PoS for some time now, will join with the Mainnet during the Merge, ending PoW mining on the Ethereum network.
PoW mining involves using massive amounts of raw computing power to brute force solutions to mathematical problems, and solving these problems gives the miner a reward. PoS, on the other hand, depends on validators that have staked tokens to ensure the legitimacy of the next block on the chain.
After the switch to PoS, it’s estimated that Ethereum’s energy usage will drop by as much as 99.95% – a spectacular reduction in emissions for a chain whose environmental impact has caused significant controversy over the years.
What Are the Bellatrix and Paris Upgrades?
The next big item on the agenda for the Ethereum developers is the Bellatrix upgrade. In this update, the Beacon Chain will be readied for the Merge.
Following the Bellatrix upgrade, Ethereum’s Paris upgrade, scheduled for somewhere between Sept. 10-20, will complete the process. The Paris upgrade will be triggered when the Total Terminal Difficulty (TTD) reaches a certain height of 58,750,000,000,000,000,000,000. After that, the next block, arriving about 13 minutes later, will be validated using PoS. At present WenMerge.com estimates it to happen on September 13, but this is of course subject to change.
These two upgrades come on the heels of a long list of testnet events and other trials, and while they will signal the completion of the Merge, many key upgrades to the Ethereum network will continue to be made over the course of the next year. These include the Shanghai upgrade, which will allow for the withdrawal of staked ETH (stETH), as well as sharding, a scaling solution that will see the chain split into multiple sections.
Will Ethereum Merge Result In a Hard Fork?
Despite massive enthusiasm from the crypto community for the Merge, the idea of a hard fork, where a blockchain splits in two, has been discussed by some Ethereum miners who are faced with a loss on their substantial investments in crypto mining rigs post-Merge. This crowd has even gone so far as to propose a new token, ETHW, which would represent a theoretical PoW chain post-Merge, and are stockpiling their ETH holdings in anticipation of receiving this new coin, much like Ethereum’s 2016 hardfork that rolled back the “The DAO” hack and resulted in the creation of Ethereum Classic, a coin that has since suffered multiple 51% attacks.
The creation of this alternate future universe appears to be very much in doubt, however, as heavy hitters in crypto space continue to express their commitment to the PoS chain. These include Circle, issuer of the USDC stablecoin, who has shared that its “sole plan is to fully support the upgraded Ethereum PoS chain,” and Ethereum founder Vitalik Buterin described hard fork proponents as people merely out to make a quick buck. For their part, leading exchanges in the industry have said they would review listings for any forked tokens but made no guarantees they would be accepted.
Regardless, those interested in a hard fork still have the power to go about their plans; it’s only a question of whether anyone will follow them. On the back of negative sentiment about the possible hard fork, the price of ETHW dropped by 62% on various crypto exchanges.
How will the Ethereum Merge impact CYBAVO and clients?
If executed right, the Merge upgrade should be quite seamless and cause minimum disruption, and this applies to CYBAVO as well. We suggest you read the official CYBAVO Ethereum Merge Support guide here. In the meantime, here’s a TL;DR:
In short, CYBAVO will support the transition to the new PoS chain, and will conduct 2 short planned downtimes, one on 6 September (Bellatrix upgrade) and one for the actual Merge update when it happens sometime between 10 and 20 September. If an unplanned Ethereum PoW hard fork happens, CYBAVO will first monitor the stability, usage, and long-term viability of it before we make a decision whether to support the PoW chain.
We will communicate clearly with up-to-date information via our support channels, and clients can also contact us on help@cybavo.com to alleviate any concerns.