By Yuga Cohler, Staff Software Engineer at Coinbase

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The Merge is coming. The long-awaited transition of the Ethereum network’s consensus mechanism from Proof-of-Work (PoW) to Proof-of-Stake (PoS) is expected to arrive sometime this year. After the Merge, the already-running Beacon Chain will begin validating Ethereum mainnet’s blockchain through a system based on rewards and penalties (i.e. “stake”) rather than the costs associated with computational intractability (i.e. “work”). Six years in the making, the Merge will be a milestone in the history of cryptocurrencies with both material and philosophical implications.

Perhaps the most heralded aspect of the Merge is its resulting efficiency: Ethereum’s shift to PoS will lead to a projected 99.95% reduction in energy consumption compared to PoW. This evolution will be a welcome development at a time when energy costs are surging across the world. Of course, there are legitimate counterarguments against PoS — for example, the concentration of wealth that some PoS designs can facilitate as well as the lack of comparable at-scale testing. Nevertheless, given the existence of a peer-to-peer blockchain network that continues to operate on PoW — namely, Bitcoin — the Merge makes sense as a strategic next step for Ethereum and should garner the goodwill of the environmentally conscious.

The essential accomplishment of the Merge, however, is a more humanistic one than energy efficiency. The Merge has proven to be an extremely complex task with many challenges. Yet, its completion will be achieved not through the…


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