What was the Ethereum Merge?

How Ethereum started: mining

Nodes need a way to agree on each new block. This is called a consensus mechanism.² Ethereum began with one called proof-of-work.³ Miners raced, by trial and error, to find a special number for each block, called a nonce. Only blocks with a valid nonce could be added.³

Mining used a lot of energy. By one estimate, just before the switch, Ethereum miners used about 70 TWh a year, about the same as the Czech Republic.³

The Beacon Chain

Ethereum's developers prepared for years to move to proof-of-stake.¹ On 1 December 2020, a separate proof-of-stake chain called the Beacon Chain was launched. It ran alongside the main network.¹ At first it did not handle normal transactions. It only agreed on its own validators and their balances.¹

The switch

The Merge happened on 15 September 2022.¹ The original Ethereum chain joined the Beacon Chain, and they became one chain.¹ The upgrade that made the switch was called Paris.⁴ Mining stopped being a way to make blocks, and validators took over that job.¹

How staking works

In proof-of-stake, validators lock up ETH in a smart contract.⁵ They check new blocks and sometimes create them.⁵ If they cheat, for example by proposing two blocks when they should send one, some or all of their staked ETH can be destroyed.⁵ To become a validator, you deposit 32 ETH and run three pieces of software.⁵

Time is split into slots of 12 seconds. 32 slots make an epoch, which lasts 6.4 minutes.^5,1 In each slot, one validator is chosen at random to propose a block.⁵ Once a block is finalised, undoing it would mean burning over a third of all staked ETH.¹

What did not change

No history was lost. The whole transaction record carried over.¹ Holders did not need to do anything. There is no "old ETH", "new ETH" or "ETH2", and people who say otherwise are likely scammers.¹

The Merge did not lower gas fees, and it was never meant to.¹ Transactions are about as fast as before.¹ Withdrawing staked ETH came later, in an upgrade called Shanghai/Capella.¹

The old names "Eth1" and "Eth2" are gone. They are now the execution layer, which handles transactions, and the consensus layer, which handles proof-of-stake.¹