The Transition to Proof-of-Stake: Everything About the Ethereum Merge

So what is the Merge

Since the beginning, Ethereum has been protected by the Proof-of-Work (PoW) consensus mechanism requiring hardware computing power to solve complex mathematical equations in a competitive process to mine the next block on the Ethereum blockchain. The transition to Proof-of-Stake (PoS) will remove the need for mining nodes to compete for block rewards and instead require node operators to deposit 32 ETH as a collateral to become network validators to receive rewards.

Why Ethereum is moving to PoS

• Improved decentralization by lowering hardware requirements
• Faster transaction confirmation times
• Over 99% energy consumption reduction
• Enabling future scalability solutions (e.g., sharding)
• Enhanced security through client diversity
• Reduced issuance, making ETH potentially deflationary

Before the Merge, around 13,000 ETH were mined daily. After the Merge, that number dropped to about 1,600 ETH — a reduction of over 90% in daily issuance.

More about Ether Staking

To participate in Ethereum’s new consensus mechanism and earn block rewards, validators must stake 32 ETH. This ETH is locked in a smart contract until withdrawals are enabled in a future upgrade. Selection for proposing a new block is made randomly, rather than based on stake size alone, ensuring fairness.

Staking options for everyone

• Solo staking by running a validator node with 32 ETH
• Joining staking pools to combine funds with others
• Using crypto exchanges offering pooled ETH staking services

What might the Merge mean to you

If you already hold ETH, there’s nothing you need to do. Your assets remain safe, but beware of scams — always verify the legitimacy of any instructions received.

For eco-conscious users, the Merge is a win, eliminating energy-intensive mining. This shift greatly reduces Ethereum’s carbon footprint.

And what about the ETH price after the Merge

Despite the 2022 crypto market downturn, the Merge created expectations for long-term growth in ETH’s value. Though volatility remains, a successful Merge positions Ethereum for greater investor confidence and potential price increases. Still, advisors recommend a long-term holding approach rather than speculation.

The Merge does not immediately reduce gas fees or increase transaction throughput. However, upcoming Layer 2 solutions and future upgrades like sharding are designed to address these issues.

Key Comparison: Ethereum Before and After the Merge

Feature	Before Merge (PoW)	After Merge (PoS)
Consensus Mechanism	Proof-of-Work	Proof-of-Stake
Energy Usage	High	~99.9% Lower
Validator Requirement	Expensive mining hardware	32 ETH deposit
ETH Issuance Rate	~13,000 ETH/day	~1,600 ETH/day
Transaction Speed	~13 TPS	Similar (speed unchanged)
Security	Secured by miners	Secured by validators

And what’s next?

After the Merge, Ethereum developers will focus on implementing sharding — splitting the network into smaller “shards” to increase scalability and reduce fees. Other improvements include:

• Proposer-Builder Separation (PBS) to mitigate MEV (maximum extractable value)
• Further upgrades to improve security and reduce costs

Ethereum’s evolution continues, but the Merge stands as one of the most pivotal developments in blockchain history. And rest assured: your funds in the Quppy Wallet remain safe and secure during and after the Merge.