It’s finally here: what you need to know about the long-awaited Ethereum network update

Ethereum’s leading developer and co-founder both reported the successful transition of the world’s second cryptocurrency network to the new Proof-of-Stake (PoS) consensus algorithm. The development of this project continued for five years.

Activation complete

Ethereum has successfully transitioned to Proof-of-Stake (PoS). The activation of The Merge update to the Ethereum core network is now complete. The developers claim that there were no bugs or failures during the update process. Interestingly, the transition to PoS has not had much effect on the ETH price so far, probably due to yesterday’s severe market correction.

Work on this update has been going on for five years, and its implementation has been postponed several times. Ethereum co-founder Vitalik Buterin also confirmed the successful migration of the Ethereum blockchain to Proof-of-Stake and congratulated everyone who had been waiting for it for so long.

Activation took place on block #15537394.

The block times of the last 100 blocks!
Amazing stability after the merge! Only 1 missed block.
This is really the best case scenario! pic.twitter.com/dV1PF70vCL

— Martin Köppelmann 🇺🇦 (@koeppelmann) September 15, 2022

User activity

Before The Merge update, users deposited a huge amount of ETH on centralized exchanges — a record for the last six months. Apparently, everyone wants a new altcoin EthereumPoW (ETHW), which is automatically formed after the fork.

Previously, we explained in detail how you could make easy money from the merger, and funding your exchange account was the easiest way to get the new coin.

Among the records of topping up exchanges is 738,442 ETH worth $1.2 billion, which was brought to Bitfinex and Binance in two transactions (both exchanges officially support the new altcoin).

Meanwhile, the new altcoin (or the “old” version of Ethereum), already named ETHPOW or ETHW, can only survive with broad support from miners, exchanges and developers. While there is no concrete news on the launch of a viable version of this altcoin, the project’s official Twitter promises the publication of the final code and the project’s launch in the next 24 hours.

Network performance

While Ethereum’s difficulty and hash rate decreased noticeably, Ethereum Classic’s network performance grew by more than 70% in 24 hours, exceeding 100 Th/s. After the activation of The Merge, ETC’s closest competitor showed the best growth dynamics among the top 20. 

Interestingly, for example, the Ravencoin (RVN) hash rate reached 14 TH/s (+120% per day), and a similar increase in activity is observed in many other PoW blockchains. Obviously, miners are leaving the Ethereum PoW network en masse.

Meanwhile, the first block on the ETH network after The Merge was created this morning, officially confirming the blockchain’s successful transition to the Proof-of-Stake algorithm. You can already see the new reward for block creation, and the daily emission of new ETH is reduced by 90% compared to PoW.