The Merge - A Success!
Background
Originally called The Docking, The Merge was the event that combined Ethereum’s mainnet execution layer with a Proof of Stake (PoS) consensus layer which, consequently, abandoned Proof of Work. For a brief overview on PoS, head over to our Intro to Staking article.
A few benefits of bringing PoS to the Ethereum mainchain include improved security, scalability potential, and a massive reduction in its environmental impact. It is claimed that 99.5% less energy will be used to maintain the blockchain post-merge. Major milestones leading up to The Merge are captured in a timeline from the Ethereum Foundation shown below.
Ethereum PoS Development - Major Milestones
Preceding both main consensus and execution layer upgrades to the Beacon Chain was the Altair upgrade in late October 2021. It increased validator inactivity and slashing penalties as the Beacon Chain’s functionality matured.
In September 2022, The Bellatrix upgrade scheduled the PoS cutover to occur when the Total Terminal Difficulty (TTD) reached 58750000000000000000000. TTD is the cumulative total Ethash mining difficulty, so this value’s rate of change is correlated to the number of active ETH miners. The Bellatrix upgrade also updated the validator slashing penalty.
Upon reaching a TTD of 58750000000000000000000, the Paris upgrade of the blockchain’s execution layer commenced. This moved block validation to Beacon Chain PoS validators, which meant the blockchain officially forked and moved away from PoW miners. This was The Merge.
Since The Merge was tied to TTD, the exact timing of the event could not be scheduled. It was predicted to occur around 5:00am PST Thursday September 15, 2022, but a slew of mining power came online within the last 24 hours leading up to The Merge which accelerated the rate that TTD was increasing. This caused The Merge to occur more than six hours sooner than predicted at 10:42pm PST on Wednesday, September 15, 2022 according to bordel.wtf.
Outcome
Impressively, Ethereum’s transition to PoS occurred seamlessly and without any impact to users of the blockchain. Holders of Ethereum assets whether they were ERC-20 tokens (ETH, stablecoins, etc.), ERC-721 assets (NFTs), ERC-1155 assets, etc. were unaffected just like the assets’ smart contracts. This was a classic case of: No news is good news.
At around 5 minutes after The Merge completed, the Ethereum Foundation’s website reported the ETH blockchain was secured by over 14.446 million ETH staked across 427,192 validators. In dollar terms, that was over $23 billion at the time!
Additionally, and more importantly, the number of validators is trending in a positive direction. The graph below shows the Beacon Chain launched with roughly 21,000 validators and at the time of this article more than 428,000 validators secured the Ethereum Blockchain. In just the past three months there has been a nearly 7% increase in the number of validators, contributing to an over 80% annual increase.
Beacon Chain Validators - All Time
Although the number does not represent unique validators, the network should become more decentralized as sharding and other planned improvements are implemented. The Merge is one of a handful of various planned upgrades to the Ethereum blockchain that support sustainability, layer-2 scalability, validator decentralization, and a reduction in transaction costs. Learn more about Ethereum blockchain improvements here.
