Cryptocurrencies such as Ethereum and Bitcoin receive criticisms for their mining processes which consume a lot of energy. Ethereum’s biggest-ever upgrade just went live and according to industry experts, this is a major turnaround for the entire cryptocurrency sector. The massive software upgrade which is designed to reduce the cryptocurrency’s energy consumption by at least 99 percent was successful.
Following the upgrade, Ethereum has moved to a new system known as proof-of-stake which swaps out miners for validators, thereby reducing energy consumption. With the new system, instead of running large networks of computers, validators leverage their existing cache of ether as a means to verify transactions and mint new tokens. This way, energy consumption is drastically reduced and according to expert opinions, the protocol is more sustainable and secure. The price of Ether soared following the announcement.
According to the Ethereum Foundation, the new system will use 99.95 percent less energy, an advantage that’ll see Ethereum surpass its rival Bitcoin, according to experts. It is pertinent to know that prior to the software upgrade which is known as Merge, a single transaction on Ethereum consumes as much power as an average US household uses in a week, according to Digiconomist.
Ethereum’s new system obliviates the old system of computers validating transactions by solving complex maths problems and introduces the new “proof of stake” system, where individuals and companies act as validators, using their ether as collateral, to win newly created tokens.
Via a tweet, Ethereum’s founder said that “Happy merge all. This is a big moment for the Ethereum ecosystem.”
And we finalized!
Happy merge all. This is a big moment for the Ethereum ecosystem. Everyone who helped make the merge happen should feel very proud today.
— vitalik.eth (@VitalikButerin) September 15, 2022
Commenting on the update, Danny Ryan, a core developer who has been working on the merge for five years said that “There might be some sort of small fire that gets put out very quickly. But the network as a whole — because of the redundancy across all this different software — will very likely be stable and fine,” adding that developers will be watching for any irregularities via both automated and manual monitoring systems. He also mentioned that if any problem arises, the corresponding thing will be on guard to debug and release a patch to users. He, however, reiterated the team’s confidence in the new update.
As of the time of this draft, Ether was trading at $1,604.67.