Ethereum Merge is one of the most awaited upgrades in the history of the crypto industry. This brand new project has been called Eth2, Ethereum 2.0, ETH 2.0, and many things in the past, but earlier this year the Ethereum community settled on the “merge.” 

Despite the hype around this very few people fully understand what this means. In this article, we shall look at what is the Ethereum merger, what are the changes, and what are its aims and economic implications.


The main motivation of the Ethereum merger is to change it from its current PoW (Proof of Work) to the PoS (Proof of Stake) mechanism. In short, in the PoW model, the network is secured by miners who have to buy and run their mining hardware. This model consumes a lot of electricity in exchange for block issuance and a portion of the transaction fees also known as gas. 

In the PoS model, the network is secured by validators who have to stake ETH to validate the network. This PoS model doe not consume much electricity. 

This transition from PoW to PoS aims at making the Ethereum network more energy-efficient, and more secure while underlying the foundation for more scalability. 


This move to PoS is being marked as one of the biggest milestones of the crypto-industry and the process which started long before its launch. In fact, the transition of Ethereum from PoW to PoS is a potentially dangerous change. Hence this process was carried out over a long period of time, in two parts to ensure the network runs smoothly. 

The First Part – Launch of the Beacon Chain in December 2020. This was a separate parallel PoS chain, built to test over a period of time. This beacon chain was completed unrelated to the main network that secures billions of dollars of economic activity. 

The Second Step – The Merger, this helped join the beacon chain with the Ethereum main chain. 


The Ethereum merge is a long-planned upgrade aimed at improving the network. Its success will make it possible for developers to introduce a variety of new features to the network.  

  1. Reduce the power consumption to secure Ethereum by 99.95%. 

This means Ethereum is now an ESG complaint which is good news for our regulatory-driven institutions that may want to explore options in the Ethereum ecosystem. 

  1. There will be a decline in issuance, which means Ethereum could take over Bitcoin in market cap over the next year, according to an Aug. 12 report by research firm insight.
  1. This Merger will allow Ethereum enthusiasts to secure Ethereum from home. Being a consensus participant is no longer for institutions and sophisticated miners. This will help further decentralize the Ethereum network, making it more resistant to attackers.
  1. Faster transaction confirmations by reducing block time variance. 


Despite a few risks the researchers and developers are spending countless hours ensuring the Ethereum merger is smooth. The Ethereum merger might be a big leap but this is just the start. There is news of four more phases running in parallel, called ‘surge, verge, purge, and splurge.’ According to the developers, these upgrades will make the Ethereum network faster, safer, and even more.

To get started on your blockchain journey, contact us.


September 16 2022


Want to see your idea as the next big thing?
With Luxeveda, your business is destined to grow to a new level. Speak to a BrandTech Consultant to create a game-changing experience!