Novices who understand these 10 questions can also understand Ethereum's merger and bifurcation

The highly anticipated merger of Ethereum has finally entered the final countdown.

As of 15:00 on August 25, Ethereum is expected to complete the merger at about 5:30 on the 21st day. Ethereum also issued a statement saying that the final date of the merger is expected to be around September 16.

To put it simply, the merger is the process of converting Ethereum from the pow mechanism to the POS mechanism. The former uses computational mining to produce blocks, which is beneficial to miners; The latter is to pledge assets to benefit users and developers. That is to say, Ethereum's output is no longer mined by computing power, and ordinary users can complete transaction confirmation and receive rewards by depositing eth assets on the chain, which also means that miners' unemployment and user participation threshold are reduced. To this end, the miners resisted by hard forking, that is, creating another Ethereum chain that continues to use the pow mechanism to rival the POS version.

1. What is the relationship between merger and Ethereum 2.0?

Ethereum 2.0 is the ultimate goal of Ethereum. Merger is only the first stage of realizing Ethereum 2.0, and the two cannot be equated. After the merger, four stages of optimization and upgrading need to be completed before Ethereum 2.0 can finally be realized. The time of realization is estimated to be around 2025. At that time, Ethereum's TPS (that is, the number of transactions that can be confirmed per second) can theoretically reach 100000, but now it is only less than 50.

2. After the merger, will gas fees and TPS problems be significantly improved?

After the merger, the problems of high gas fees and low TPS will be alleviated to a certain extent, but the current dilemma will not be completely reversed.

Because the upgrade of the slicing technology to completely solve the underlying performance problems needs to be completed in four stages after the merger. The merging stage is mainly to realize the smooth switching of the consensus mechanism, that is, to safely and stably switch from POW to POS. However, it is also worth excited that after switching to POS, Ethereum's energy consumption will be directly reduced by more than 99%, because it no longer needs physical mining machines, and the widely criticized pollution problem will be solved once and for all.

3. Why can merger bring eth deflation?

In the pow mechanism, in order to maintain the network operation, Ethereum needs to pay a large amount of eth as a commission reward. This part of eth is actually an additional issue of assets, which will constitute an inflation model after flowing into the market, that is, more and more ethereums are circulating. Therefore, this mode of affecting asset scarcity is certainly not conducive to maintaining and increasing value.

After the merger of the POS mechanism, Ethereum does not need to pay additional fees to miners, and eth theoretically does not need to issue additional shares. In addition, as early as 2020, Ethereum introduced the eip-1559 protocol, that is, the scheme of targeted destruction of miners' handling fees, so the current stock of Ethereum will be less and less. Theoretically, it will enter the deflation model, which is conducive to the firmness of asset prices in the long run.

4. Why does it need to pledge 32 eth to run a verification node?

After the merger, the verification node replaced the miner and was responsible for confirming the transaction. There must be a certain threshold to become a verification node. If the number of eth pledged is too low, it will lead to vicious competition between big and small miners similar to POW mechanism, delay the speed of transaction confirmation, and cause Ethereum to be blocked and expensive. But why must there be 32 eth? Because 32 is the fifth power of 2, and the message transmission under the POS mechanism is exponential. According to the design of the POS mechanism, transaction verification involves mutual recognition of information at both ends of the submitter and verifier, that is, the information submitter and verifier need to complete the confirmation according to the number of pledged assets in the shortest time. Through systematic calculation, 32 eth is the optimal solution. Of course, with the later performance optimization, this number may be adjusted dynamically.

5. Will Ethereum pledgers sell the ETH they extracted after the merger?

In fact, Ethereum has been preparing for the merger, and in November 2020, it opened a small-scale pledge mode in advance. As of August 1, the data on the chain showed that Ethereum's total pledge was about 13.132 million eth. As the merger approaches, a considerable number of users holding eth worry that these pledgers will sell the pledged eth, which will affect the asset price. According to the mechanism design of Ethereum after transferring to POS, the pledgor can only withdraw the pledged assets within 6 to 12 months after the merger.

Therefore, there will not be a large number of pledged eth sold at the initial stage of the merger. Even after the withdrawal date expires, Ethereum officials will restrict this, and at that time, there will be a queue for withdrawing assets. To understand the image, the pledged asset pool is like a pool, and the speed of water release will be slow, just like a trickle, rather than opening the gate to release the flood.

6. Why is the merger of Ethereum postponed repeatedly? Can the Ethereum merger be completed as scheduled?

The merger of Ethereum is essentially a fundamental adjustment and reform of the benefit distribution mechanism of all parties in the ecosystem. Completing this task has certain challenges. It should be noted that Ethereum has tens of millions of users, developers and miners, even all over the world. In addition, Ethereum has developed rapidly in recent years, and the assets and applications on the chain have exploded, which directly increases the difficulty of merger. Because the technical security and interest coordination issues involved are more complex, the merger has been postponed since several years ago.

Before the formal merger of the main network, Ethereum has successfully completed three test network mergers, that is, three rehearsals and training before the merger. According to the official statement, the merger is expected to be completed around September 16. In this regard, Ouyi Novice College will continue to pay attention to the latest situation, and we will also do follow-up interpretation of popular science.

7. After the merger, will Ethereum encounter network attacks?

Under the pow mechanism, the security threat of Ethereum mainly comes from the network paralysis caused by the stoppage of miners who control more than 51% of the computing power, that is, more than half of the transaction confirmation rights. After switching to POS, this problem will no longer exist, but new security problems will follow. Because the pledged assets correspond to the voting rights of key issues in the community, this gives the large-scale pledge owners a certain authority to do evil. They can vote for proposals that are not conducive to the community or veto proposals that are beneficial to the ecology to achieve their own goals.

In other words, the more assets pledged, the greater the possibility of evil.

8. In the face of eths and ethw after hard bifurcation, how do we choose the head items?

After abandoning the pow mechanism, all miners will lose their jobs and their rice bowls will be smashed. Therefore, hard forking is a means for miners to fight back against the merger. After the hard fork, ETH will split into two chains: eths (Ethereum in the POS version) and ethw (Ethereum in the pow version). The project parties and users on the chain must choose side stations. Generally speaking, it is the common wish of the majority of developers and users to choose the ETH chain, because it is more in line with their interests, which can also be seen from the current positions of all parties. At present, the majority of the project parties express their support for eths, mainly including:

1. The two most mainstream stable coin issuers: tether (usdt) and circle (usdc);

2. Head defi projects: Oracle chainlink, loan agreement AAVE, decentralized wallet debank, and stable currency transaction agreement curve;

3. NFT project: Yuga labs, publisher of bayc boring ape, etc.

However, most of the project parties that publicly support ethw are not in the head, and the volume and potential energy are smaller. Some KOL station miners are also more out of their own interests, and few responders.

9. If the hard fork fails, where will the previous POW miners go?

The current public opinion environment shows that the hard fork has not been widely supported, and it is more a self rescue action initiated by the miners. Therefore, after the failure of the hard fork, the miners had to move elsewhere. The main destinations are: turning to other public chain mining that supports POW mechanism, such as etc; Carry out computational mining of some unpopular assets and projects, such as grin; Carry out other network computing services except mining.

It should be noted that the influx of large-scale Ethereum miners into other public chains will bring huge shocks to the output of other project assets, and then affect asset prices. Users who intend to invest need to make prudent judgments, control risks, and buy at the right time, such as etc.

10. How can ordinary users enjoy the dividend of this Ethereum merger?

For the majority of users, the biggest bonus of Ethereum merger is that it opens up a lying profit mode of saving money and earning interest for everyone. In other words, as long as you deposit the pledge in Ethereum, you can get rewards.