The historic day has come for Ethereum. Ethereum Merge has happened, and Ethereum has now passed from a Proof of Work (PoW) system to a Proof of Stake (PoS) system. Introduced by Vitalik Buterin with the PoW algorithm in 2015, Ethereum has been trying to become energy efficient by switching to the PoS system for many years. So what is this Merge?
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The PoW system is a business protocol introduced in 1993 by Cynthia Dwork and Moni Naor to prevent spam e-mails. Based on miners, this system proceeds by adding new blocks to the blockchain and solving mathematical problems.
The mining flow, affecting GPU manufacturers and video players for many years, will slow down a bit with this network transition. So does this mean that mining is over? Of course not. Today, many coins still work with the PoW system, but one of the most popular is Ethereum. Now miners can start looking for new coins.
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On the other hand, the PoS system works entirely through staking validators. Transactions added to the blockchain are confirmed by validators, which is how they qualify for rewards. Currently, 32 Ethereum stakes are required to become an Ethereum node validator.
Together with the PoS system, Ethereum will reduce its annual energy consumption from approximately 112TWh to 0.01TWh per year. After miners disappear, token inflation will also see a decline.
