Tuesday, June 6, 2023

The Merge (Ethereum 2.0)

by Hideo Nakamura
The Merge (Ethereum 2.0)

The Merge (Ethereum 2.0)

The Merge is the term used to describe Ethereum’s plans to upgrade its existing blockchain by transitioning from a proof-of-work consensus mechanism to a proof-of-stake system. This move is part of what is known as Ethereum 2.0, which aims to improve scalability, security and sustainability of the network while also reducing transaction fees for users. The Merge will be achieved in two phases: Phase 0 and Phase 1.

Phase 0 – Beacon Chain
In this phase, the Beacon Chain will be launched as an independent blockchain that runs parallel with Ethereum 1.0 chain but does not interact with it directly yet. This new chain will use a proof-of-stake consensus algorithm instead of proof-of work in order to secure it against attacks and keep transactions running smoothly on the network at all times. In addition, validators who stake their ETH tokens on this chain can earn rewards for doing so in exchange for increasing the overall security of Ethereum’s network infrastructure .

Phase 1 – Shard Chains
Once the Beacon Chain has been successfully launched and stabilized following its launch, then Phase 1 can begin with shard chains being added on top of it which eventually allows both blockchains (Beacon & ETH1) to communicate and interact together using smart contracts written specifically for these new shards chains . These shard chains are designed as individual layers within Ethereum 2.0 that allow more data storage capacity than was possible before; thus making way for larger decentralized applications (dApps) built upon them without sacrificing too much decentralization or censorship resistance throughout the entire process .

The Merge marks an important milestone towards achieving true decentralization across multiple networks while still providing users with robustness , scalability , interoperability , malleability , privacy improvements . Overall, The Merge helps make sure that any major changes made within one layer won’t have severe impacts on other parts due to compatibility issues—which ultimately means faster speeds when processing transactions compared to previous versions of Ethereum’s protocol stack!

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