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Date: September 15th 2022
Published on: Global News
The Merge is a long-awaited update of the Ethereum blockchain. It occurred on September 15 at 06:42:42 UTC (block 15537393). The update switched the network’s consensus model from proof-of-work to proof-of-stake. To do so, the Ethereum Mainnet merged, hence the name of the update, with the Beacon Chain, the proof-of-stake consensus layer.
The Beacon chain was created in late 2020 and launched alongside the Ethereum Mainnet. Following the Merge, both blockchains have finally come together. As a result, the Beacon Chain now acts as the consensus engine for the Mainnet. It, therefore, marks the permanent transition to a proof-of-stake consensus on Ethereum and the end of proof-of-work.
It makes Ethereum more sustainable and eco-friendly since the PoS consensus is less energy-consuming. The Merge helped reduce the network’s energy consumption by 99.95%, according to Ethereum.org.
The main goal of switching Ethereum to a PoS consensus is to make it more sustainable and eco-friendly while opening the door to scalability upgrades.
Following the Merge, other updates will roll out to bring additional features, including:
Read more: 5 things to know about Ethereum
Proof-of-work and proof-of-stake are two consensus models for blockchains. It’s the method allowing to validate cryptocurrency transactions and add them to the blockchain.
Proof-of-work was the first consensus model used by blockchains, pioneered by Bitcoin. In this consensus model, miners are using huge amounts of processing power. The more processing power miners have, the more transactions they can validate. The first miner to successfully do so gets to add the transaction to the blockchain and receives a determined amount of crypto in return.
Proof-of-stake is another consensus model used, for instance, on Tezos and TRON blockchains. The consensus solves the high environmental consumption of PoW. Indeed, PoS relies on staking instead of processing power to validate transactions. Validators can provide their own coins as collateral or “stake” to get a chance to validate transactions and get a transaction fee in return.
Scorechain Blockchain Analytics supports Ethereum, ERC20 tokens, and stablecoins, even after the Merge. The software allows compliance teams to monitor Ether and ERC20 token transactions and helps them to implement a 360 risk mitigation policy.
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Scorechain is a Risk-AML software provider for cryptocurrencies and digital assets. As a leader in crypto compliance, the Luxembourgish company has helped over 200 customers in 45 countries since 2015, ranging from cryptocurrency businesses to financial institutions with crypto trading, custody branch, digital assets, customers onboarding, audit and law firms, and some LEAs.
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