Ethereum Merge - "One of Biggest Decarbonization Events Ever" Lets Wait And See!

Many of its major biggest players in the crypto currency market like Bitcoin and Ethereum, have come under increasing fire for the so-called mining activities that power their blockchains' Popular energy tracking studies (e.g., Digiconomist and the Cambridge Bitcoin Energy Consumption Index (CBECI)) have estimated energy consumption ranges from 29.96 TWh to 135.12 TWh and 26.41 TWh to 176.98 TWh, respectively for Bitcoin as of July 2021, which are equivalent to the energy consumption of countries such as Sweden and Thailand. The latest estimate by Digiconomist on carbon footprints shows a 64.18 MtCO2 emission by Bitcoin as of July 2021, close to the emissions by Greece and Oman

Ethereum's methods for verifying transactions, creating new coins, and securing its network have all undergone significant changes as a result of the implementation of a significant network update, which was long anticipated. This technique, known as proof-of-stake, will now significantly decrease Ethereum's energy usage by almost 99%.

The long-awaited software upgrade was made public recently Since it was first proposed in 2014, the update, known as "the Merge," has experienced a number of setbacks, leading many to wonder if an alternative, energy-efficient consensus plan for the industry will ever materialise.

According to a report released today by research firm Crypto Carbon Ratings Institute, Ethereum's electricity use is anticipated to decrease by a staggering 99.988 percent following the Merge (CCRI). According to CCRI, the network used to consume over 23 million megawatt-hours annually. It is anticipated to require just over 2,600 megawatt-hours annually in the future. The article uses the image of the Eiffel Tower shrunk to the size of a Lego toy person to illustrate exactly how significant this is.

Merge : What is it ?

According to Ethereum The Merge was the joining of the original execution layer of Ethereum (the Mainnet that has existed since genesis) with its new proof-of-stake consensus layer, the Beacon Chain. It eliminated the need for energy-intensive mining and instead enabled the network to be secured using staked ETH. It was a truly exciting step in realising the Ethereum vision—more scalability, security, and sustainability.

Source : ethereum.org

Initially, the Beacon Chain shipped separately from Mainnet. Ethereum Mainnet - with all its accounts, balances, smart contracts, and blockchain state - continued to be secured by proof-of-work, even while the Beacon Chain ran in parallel using proof-of-stake. The Merge was when these two systems finally came together, and proof-of-work was permanently replaced by proof-of-stake.

The successful launch of The Merge places greater pressure on other cryptocurrencies still using proof of work. The elephant in the room is Bitcoin, which is currently estimated to gobble up more electricity per year as the country of Kazakhstan.

The Merge may not only benefit the environment, but it may also draw more capital to Ethereum from ESG investors, who only put their money into businesses and sectors that meet specific environmental, social, and corporate governance standards. After the conversion to PoS, investors who are prohibited from purchasing tokens that operate on PoW systems would be able to purchase ETH, Ethereum's native token, according to a report this week from Bank of America. However, miners who were mining ether (ETH) before the Merge have now shifted to mining alternative PoW-based digital currencies, such as Beam, Ravencoin, and Ethereum Classic!.