Ethereum After The Merge. What Do We Have, And What Will Happen Next?

By Author: Roman Korzh
Total Articles: 31
Comment this article

On September 15, 2022, the event that many people in the crypto community have been looking forward to finally happened. Years of preparation provided an instant blockchain transition from PoW to PoS. But what did Ethereum get after transitioning from one consensus mechanism to another?

After the instant transition, Ethereum holders continued to use their funds. Although some crypto wallets blocked the assets of Ethereum users. It was to be expected as sites and services needed to be upgraded.

One wonders what we have got now

Here is one of the most frequently asked questions. Did The Merge affect the value of ETH? Look at the Ethereum price curve. A few days before The Merge, the price of ETH increased slightly. However, there was no significant rise in the price of ETH, and it began to decline later. When The Merge had been completed, the price continued to fall, but a few days later, it leveled off within $1,276 - $1,362.

The second important question that worries many of the Ethereum community concerns the speed of transactions. Namely, whether the transaction execution speed will increase. Of ...
... course, one cannot count on noticeable changes in this matter. However, Ethereum developers plan to address this issue in the future. So, please hold the line; we will talk about it below.

One of the essential disadvantages of Ethereum, which narrows the circle of its fans, is the high gas fees. That's why people often ask how Ethereum gas fees have changed since The Merge was done.

So what do we have? The Merge did not increase the cost of ETH and transaction speed, and did not even reduce gas fees. But why was it necessary to do The Merge, you ask? The Merge was planned and executed to solve completely different problems. Now Ethereum has significantly reduced energy consumption. Replacing miners with validators has increased the reliability of the chain, reducing the risk of centralization. In our blog, you can learn more about the benefits of PoS for Ethereum in our article (Ethereum's New Power https://www.zfort.com/blog/How-will-Ethereum-2.0-Cut-off-Energy-Consumption). Finally, and most importantly, we shouldn't forget that The Merge is just a milestone. It is Ethereum's stage of development, which paves the way to the next level.

Sharding is the way to Ethereum's scalability

Nowadays, the developers of Ethereum are working on the next tasks identified even before The Merge.

For example, according to an interview with Vitalik Buterin (https://www.wired.com/story/whats-next-for-ethereum-after-the-merge), scalability is a weakness of today's Ethereum. So this problem largely determines the high cost of transactions. However, the developers already have ideas about technologies that will correct this shortcoming without compromising decentralization.

Once the two-layer Ethereum scaling model is upgraded, the chain can handle a much more significant amount of data. Processing this data with special protocols creates something like mini-Ethereums inside of Ethereum. Today, Ethereum processes approximately 20 transactions per second, while it is believed that the above method will allow processing from 5,000 to 100,000 transactions per second. And it enables Ethereum to expand its community significantly.

What is the new frontier of Ethereum?

In addition to solving the scaling problem, sharding paves the way for new levels of Ethereum development. The developers plan to implement several more stages. The closest of them is the optimization of data structures. Namely, work with cryptographic hash algorithms. Who knows, perhaps using Verkle tree algorithms will significantly reduce the resources needed to produce a proof.

Sure, Verkle Trees technology is still young. As you may know, John Kuszmaul introduced it in 2018; however, the successful implementation of this technology in Ethereum will make decentralization much more accessible.

Well, in the long term, it is planned to work on eliminating historical data, post-quantum solutions, and solving those problems that developers may encounter while improving the blockchain.

Original source: Ethereum after the merge. What do we have, and what will happen next?

Hello, guys! I work as a software engineer at Zfort Group AI Development Company. I am interested in all news about information technologies, especially AI and ML. Once in a while, I write articles and create podcasts for a company blog. In addition, I share valuable articles from Zfort Group's blog here.