– The beginning of a new era – E24

The countdown continued for several weeks. The discussion continued for several years.

On Thursday morning Norwegian time, the world’s second largest cryptocurrency finally made the massive update on the blockchain.

Vitalik Buterin, co-founder of Ethereum, celebrates on Twitter:

– Merry Christmas to everyone. This is a huge moment for the Ethereum ecosystem, writes the Russian Canadian.

CNBC wrote that the first test after the update was a huge success,”The best possible result».

This is certainly the biggest event in the history of Ethereum, and marks the beginning of a new era, wrote COO Marius Blaker Høgevold on Norwegian crypto exchange Firi to E24.

Cryptocurrency exchanges around the world have been shut down for ethereum withdrawals prior to the “merger.”

Blaker Høgevold says Ferry expects the withdrawal doors to open again during the morning.

99% more environmentally friendly

“Merge,” or consolidation, means that Ethereum changes how transactions are controlled.

Ethereum is moving from a “Proof of Work” blockchain to a “Proof of Stake” blockchain.

The first means that the blockchain is controlled by computers to solve complex tasks. This is called “mining”. Miners are rewarded with cryptocurrency for the work they do.

“Proof of Stake” is the most environmentally friendly alternative. Instead of a continuous use of energy, transactions are verified by investors by “locking” a portion of their holdings in an escrow account. The more locked up they are, the more likely they are to be rewarded for validating the transaction.

The two largest cryptocurrencies, Bitcoin and Ethereum, each use their own mechanism where one requires power and the other does not. Blaker Høgevold says it will be interesting to see how this narrative is presented in the media, among users, and at prices.

According to ethereum, moving from “Proof of Work” to “Proof of Stake” will reduce blockchain power consumption by 99.95 percent.

Ethereum also claims that this will reduce the world’s energy consumption by 0.2 percent.

Expansion benefits

Blaker Høgevold in Firi explains that one of the main advantages of the upgrade has to do with expansion.

As the volume of Ethereum has increased in recent years, it has become expensive and slow to complete transactions.

But with Proof of Stake, the blockchain can process multiple transactions per second, Blaker Høgevold points out.

The cost of attacking the network will also increase.

– On the other hand, the new mechanism did not prove to be safe in the same way as the old one, so in this sense it implies a certain amount of uncertainty.

Blaker Høgevold believes that “inclusion” also has democratization value.

With Proof of Stake, it becomes easier for users to participate in securing the network, since in practice you only need to share (commit) ether in the protocol, he writes.

He believes that this will lead to more strikes – and thus a greater degree of decentralization.

Schibsted owns a stake in Firi of approximately 5.5 percent. E24 is a subsidiary of the Schibsted Group. Some E24 journalists own stock in Schibsted, by participating in the group’s stock savings program.