The following is adapted from ethereum.org
🚀Soon, the current Ethereum Mainnet will merge with the Beacon Chain proof-of-stake system.
⛏This will mark the end of proof-of-work for Ethereum, and the full transition to proof-of-stake.
🌱This sets the stage for future scaling upgrades including sharding.
🌳The Merge will reduce Ethereum's energy consumption by ~99.95%.
Proof-of-work has secured Ethereum Mainnet, the blockchain that contains every transaction, smart contract, and balance since it began in July 2015.
Throughout Ethereum's history, developers have been hard at work preparing for an eventual transition away from proof-of-work to proof-of-stake. This eliminates the need for energy-intensive mining and instead secures the network using staked ETH. On December 1, 2020, the Beacon Chain was created, which has since existed as a separate blockchain to Mainnet, running in parallel.
The Beacon Chain has not been processing Mainnet transactions. Instead, it has been reaching consensus on its own state by agreeing on active validators and their account balances. After extensive testing, the Beacon Chain's time to reach consensus on more is rapidly approaching. After The Merge, the Beacon Chain will be the consensus engine for all network data, including execution layer transactions and account balances.
The Merge represents the official switch to using the Beacon Chain as the engine of block production. Mining will no longer be the means of producing valid blocks. Instead, the proof-of-stake validators assume this role and will be responsible for processing the validity of all transactions and proposing blocks. This is a HUGE step in realizing the Ethereum vision – more scalability, security, and sustainability.
No history will be lost. As Mainnet gets merged with the Beacon Chain, it will also merge the entire transactional history of Ethereum. You don't need to do anything. Your funds are safe.
You do not need to do anything to protect your funds entering The Merge.
This bears repeating: As a user or holder of ETH or any other digital asset on Ethereum, as well as non-node-operating stakers, you do not need to do anything with your funds or wallet before The Merge.
Despite swapping out proof-of-work, the entire history of Ethereum since genesis remains intact and unaltered after the transition to proof-of-stake. Any funds held in your wallet before The Merge will still be accessible after The Merge. No action is required to upgrade on your part.
As we approach The Merge of Ethereum Mainnet, you should be on high alert for scams trying to take advantage of users during this transition. Do not send your ETH anywhere in an attempt to "upgrade to ETH2." There is no "ETH2" token, and there is nothing more you need to do for your funds to remain safe.
This will signal the end of proof-of-work for Ethereum and start the era of a more sustainable, eco-friendly Ethereum.
This will also set the stage for further scalability upgrades not possible under proof-of-work, bringing Ethereum one step closer to achieving the full scale, security and sustainability outlined in its Ethereum vision.
So wen merge?
Good question. We have been anticipating this transition for some time and Ethereum has had two successful dress rehearsals on two testnets (Kovan & Rinkeby). There is one more testnet (Görli) to run the merge on and 🤞 if all goes well, it’ll be time for the real thing!