Crypto glossary
The Merge (Ethereum)
The Merge was the Ethereum upgrade of 15 September 2022 that replaced proof-of-work mining with proof of stake, cutting the network's energy use by over 99%.
From December 2020, Ethereum ran a separate proof-of-stake chain, the Beacon Chain, in parallel with its original mined network. The Merge joined them: the existing execution layer, with all balances and contracts, began taking its blocks from Beacon Chain validators instead of miners. Users did not need to do anything, and ETH remained the same asset.
Mining on Ethereum ended overnight, and miners moved their hardware to other coins or shut it down. The Ethereum Foundation estimated an energy reduction of about 99.95%, and new ETH issuance fell sharply because validators earn far less than miners did. Staked ETH could not be withdrawn until the Shanghai upgrade in April 2023.
The Merge did not lower fees or raise throughput; those came later through rollups and blob space. It also drew debate over centralization, since a few liquid staking providers and exchanges control a large share of staked ETH.
Example
A miner earning about 2 ETH a block before 15 September 2022 saw that income disappear at the Merge, while a solo validator staking 32 ETH began receiving fees and rewards for proposing blocks.
Related terms
Latest articles on The Merge
- The Merge of Mining Firms: Hut 8 and US Bitcoin
- Ethereum (ETH) ends a bad 2022 despite The Merge. Is it time to buy for next year?
- Ethereum Cools Off Ahead of The Merge, ETH Liquidation Line at $1.8k
- Binance US Comes Up With Ethereum Staking Program Ahead of the Merge
- Ethereum Slips, Will ETH Recover Ahead of the Merge?
