It's here! The Merge is here! 🔗🏆

Hey y’all - do you remember where you were around 3AM EST last Thursday, September 15th? While many of you were (hopefully) sound asleep or maybe grabbing a late night snack (treat yo self!), the crypto world was on the edge of its seat for one of the most iconic feats in Web3 history. Google even had a countdown for it. 

This marked the completion of the Merge - the long-awaited haul of Ethereum, the world’s second-largest blockchain!

The Merge - a quick refresher

To our Day 1 Web3 for the Culture readers out there, the Merge is not an unfamiliar concept. But if you’re new to the program, welcome to the party and take a peek at one of our March issues, Ethereum: Why you should be paying attention, and one of our July issues, Ethereum Merge Update & Special Announcement.

Nonetheless here’s a quick recap to get us all up to speed:

The completion of the Merge marked the end of Ethereum's use of a proof-of-work (PoW) mechanism and the beginning of the use of proof-of-stake (PoS). PoW is the process in which miners complete complex puzzles to validate transactions and create new coins. Meanwhile, PoS allows users to do a similar validation according to how many coins they contribute, or stake. In return for staking more coins, users have a higher likelihood of being chosen to validate transactions on the network and earn a reward.

What’s the big deal again?

Energy conservation. One of the biggest critiques of cryptocurrency is its use of energy consumption from mining, mainly through PoW - but the Merge removes that problem. The change to a PoS chain, known as the Beacon chain, reduces the network's power consumption by more than 98%!

The fact that this was executed flawlessly is even more wild. Every day, over 1 million transactions are processed on the Ethereum network. And the Merge took place without slowing down a single one. 

That’s like changing the engine of an airplane carrying passengers midflight while its traveling across the sky at 600mph!

So, what does this mean for you?

Honestly, it’s hard to tell right now. We wish we could tell you that the price of Ether (Ethereum’s native cryptocurrency) skyrocketed in value and now we’re all able to up and move to Bora Bora, but alas – the price has remained relatively constant. And, truth be told, an immediate jump in value wasn’t the point of the merge in the first place. The main goal of the merge was to transition from the power-hungry PoW mechanism to the environmentally friendly PoS. 

Even though we’ll have to wait some years for more definitive answers on what this means long term for Ethereum, here are 5 things we know so far:

1. Investments: if you were invested in Ethereum before the Merge happened, you don’t need to do anything with your investments. Nothing has changed with them!

2. Gas Fees: transaction and gas fees remain the same, despite these high costs being a challenge for Ethereum users. 

3. Energy Consumption: like we mentioned, there is a gigantic reduction in Ethereum’s energy consumption–a huge win for the environment. 

4. Speed & Security: the Merge will likely speed up processing and offer greater security & stability for the blockchain.

5. Sharding: sharding (we’ll break this down below) is now possible, and will be the next phase in Ethereum’s roadmap.

The Merge was just the first phase of a multi-year upgrade to Ethereum

Yes, we know. The names for these phases are pretty strange lol. But now that the Merge is complete, the attention has shifted to phase 2: The Surge. 

People are specifically focused on the concept of Sharding. According to Coindesk, “‘sharding’ is a proposed method of splitting Ethereum’s infrastructure into smaller pieces in an attempt to scale the network.” Key word here is: scale!

As a result of sharding, the Ethereum blockchain will more effectively maintain large amounts of data. This is especially important because Ethereum was designed to make it easier for developers to build decentralized applications (dApps) on the blockchain. As more developers build on Ethereum, the blockchain will need to store all of the data associated with these applications. 

This is no easy feat, but one that Ethereum developers have been planning for some time now.  Sharding with Ethereum has been in discussion since 2013, and now that the Merge has successfully happened it’s expected that Phase 2 of this roadmap will be completed within the next year. 

This is just the beginning for Ethereum

Each of these phases, including the Merge, are extremely significant technological advancements that have the potential to bring Ethereum to the mainstream, if all goes according to plan. We’re excited to see what happens and can’t wait to tell people 10, 20, 30 years down the line when blockchain technology is as commonplace as electricity that we witnessed this historical feat. 

More to come, and as always we’ll keep you up in the loop!

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