For Ethereum, the merger (“the Union“in English) is imminent. This blockchain will abandon mining and thus drastically reduce its energy consumption, creating development opportunities in line with the environmental challenges of our time. Decryption.
The Merge, or “la fusion” in good French, is an important step for the Ethereum blockchain and the world of cryptocurrencies, as the general public knows it mainly for the ether. This long-awaited move to ETH 2.0 from the cryptosphere hides more than just an update. For good reason, Ethereum’s consensus mode will evolve from Proof of Work to Proof of Stake. Thus, instead of “proof of work”, a Bitcoin-like mechanism that relies on miners to validate transactions, Ethereum will switch to “proof-of-work” and will only need validators to ensure network operation.
“This is a much anticipated milestone because it is the first time that such a large and established network changes consensus algorithms along the way. When Ethereum was launched, Proof of Work technology was the most proven, it made sense to continue. But already. in 2016 the idea of a change has taken hold in the community and some have been waiting for it since 2017, which also explains the very strong interest in this merger “ comments Claire Bavla, director of blockchain and cryptocurrency at KPMG France.
A “merger” that will have as its first consequence the drastic reduction of the energy needs of the blockchain, welcomed by associations such as Greenpeace who are fighting for a change of model towards the Proof of Stake. With a wave of magic wand – so to speak – Ethereum will consume 99% less energy.
It sounds too good to be true, yet the number is realistic. “This community-advanced figure is probably quite close to reality, as miners will disappear from this protocol. Ethereum will still need some power to work, but validators will only need” a rudimentary computer. A Raspberry Pi with 2TB of disk space can do the job, which is like running a small home server “explains Grégory Raymond, co-founder and managing editor of The great whalespecialized media in the Web3.
Guillaume Henri, journalist of the IT section of Digital Confirm: “Basically, we’re going to go to the rigs [plateformes de minage, NDLR] which can consume several thousand watts on basic computers consuming only 30 watts. The only difference is that you will have to make sure you are always online so as not to risk losing your reward, so have a UPS in the event of a power failure “.
Towards a more centralized network?
Furthermore, not to be missed is the need for validators to deposit 32 ethers in order to participate in the validation of the blocks. Which is no small feat with ether over € 1,500. It will therefore be necessary to commit almost 50,000 euros to enter the system, where with the Proof of Work any machine could potentially participate (even if in order to be able to receive a prize it was necessary to use more and more computing power – and therefore consume more and more For some experts, this is a problem as Ethereum will become more centralized.
“The Merge generates several fears. The one of technical bugs, first of all. Even if there are already more than 400,000 validators and Beacon is already running in parallel on the Proof of Stake, there is never 100% certainty that everything will work out. But the greatest fears concern the governance of the network and its centralization, legitimate in that the big validators, those with a lot of liquidity, such as exchanges, could benefit from “a form of hegemony and that their self-regulation remains such of the questions. It is a leap into the unknown to move towards a technology that can offer a few players significant thresholds of domination “explains Claire Balva, who evokes fears related to the possible censorship of validators, which morally goes against the ideology of blockchains and is never well received.
But then, what about the miners and all their equipment? Undeniably, some may give up and it is possible that stock of graphics cards can be found on the second-hand market. However, not all miners will become useless.
“Miners using graphics cards will be able to mine on other protocols (Ethereum Classic for example) where proof of work is still running [Ce sera aussi le cas de ceux équipés en ASIC, NDLR]. We can also see a future for them on Ethereum 2.0, because the metaverses that will be built on it will need graphics resources. “completes Grégory Raymond who explains it “Ethereum should be seen more as a global computer on which we can develop decentralized applications. Its cryptocurrency, the ether, can be seen as the fuel to use them.”.
An orientation that The Merge should further enhance, lifting the brakes on developers and investors who have remained spectators to respect their ethical and ecological commitments.
A merger that comes at the best of times and creates new opportunities
Ethereum has been working on this change for several years, and the least we can say is that it comes at the right time, that is, before winter, in a context of uncertainty and as the energy market explodes. Seen from here, this is a huge development opportunity for Ethereum compared to other cryptocurrencies.
“The merger is timely, it is. So far many large companies have refused to use Ethereum due to their commitments to sustainable development. Notably, this has provided a niche for competing protocols like Tezos, whose main argument was centered around the respect for the environment, so this will no longer be valid and alternative blockchains will have to innovate on other characteristics “ says the co-founder of The great whale.
“I have seen large companies being wary of blockchain, because they have legal, social or cultural pressures to avoid environmentally sober technologies. These blocks will jump, because the very rich ecosystem of Ethereum will be reconciled with increasingly demanding environmental criteria.” observes the KPMG cryptographic specialist.
“I’ve also seen many greenwashing from blockchains created without a true green will, but who saw that the green argument worked very well with large accounts, sometimes with very surprising marketing speeches. From now on they will have to find other relays “adds.
To stand out, the alternatives could particularly focus on volume, processing capacity, as players like Solana or Avalanche do, although it will be difficult for them to compete with Ethereum with which they always try to have excellent connectivity. Environmental responsibility can no longer be their only argument.