The main Ethereum blockchain will merge with the Beacon Chain in this initial step, which is appropriately called "the Merge" because two independent, parallel blockchains will be brought together.
The Merge is the union between Ethereum's new Beacon Network proof-of-stake agreement layer and its current execution layer. This is one of the most anticipated moments in the history of blockchain and this much-awaited event is expected to take place sometime in September 2022. Basically, the Merge entails switching from the Ethereum Mainnet proof-of-work protocol—the blockchain in use for payments using ETH—to the Beacon Chain proof-of-stake network. Instead of using energy-intensive mining, it will be using staked ETH to safeguard the network.
Developers have been working diligently on preparing Ethereum for a potential switch from proof-of-work to proof-of-stake throughout the platform's existence. This seems to be the primary motive for the occurrence of this merge. This merge is widely considered to be an absolutely incredible step toward accomplishing the scalability, privacy, and sustainability goals of Ethereum.
The Beacon Chain was established on December 1, 2020, and it has since functioned alongside Mainnet as a separate blockchain. Until now, transactions under the beacon chain have been independent of the Mainnet. The time for the Beacon Chain to decide on more is quickly approaching after lengthy testing. Incorporating execution layer transactions and account balances, the Beacon Chain will serve as the consensus engine for all network data following The Merge.
The Beacon Chain will officially be the basis for block production following the Merge. With the Merge, the Beacon Chain will serve as the unanimity engine for all network data, especially execution layer transactions, and account balances.
Valid blocks can no longer be created by mining. In its place, the proof-of-stake validators take on this responsibility and are in charge of processing all transactions' legitimacy and submitting blocks.
There’s no need to worry about the users’ transaction history on Mainnet or Beacon as after the merge it will also be combining all of Ethereum's transactional history and no one’s funds are lost.
The Merge should arrive by Q3/Q4 of 2022. Currently, the developers are working toward a tentative goal of September 19, 2022. However, depending on the success of the final testnet merge (Goerli) in between August, further client improvements, and the sustained predictable analysis of the current miners, this could change. Great precision and hard work is going behind this project to make it happen as soon as possible.
Users do not need to take any action with their money or wallet prior to The Merge if they are an Ethereum user or holder of ETH or any other digital asset on Ethereum, including non-node-operating stakes.
After switching to proof-of-stake, Ethereum's complete history going back to its creation is still preserved and unchanged. After The Merge, users will still be able to access any money that existed in their wallet prior to The Merge. They don't need to do anything to upgrade.
The merge will lead to the birth of an upgraded version of Ethereum – Ethereum 2.0 which will have a new roadmap and new plans as to how the blockchain shall work.
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