Ethereum will delay the full deployment of its proof of stake model until later this year. This development gives those still mining Ethereum more time to transition to the new model.
Delay Confirmed
The delay was confirmed on Twitter by Tim Beiko, an Ethereum core developer. According to his tweet, the deployment of the Ethereum Merge will not take place. Instead, it will be pushed by a few months. Ethereum Merge is the name given to the transition from the PoW model to the PoS model.
It won't be June, but likely in the few months after. No firm date yet, but we're definitely in the final chapter of PoW on Ethereum
— Tim Beiko | timbeiko.eth 🐼 (@TimBeiko) April 12, 2022
A major reason for the transition is that the PoW model uses a lot of power, which is expensive and has led to a GPU shortage in recent years. Besides Ethereum, Bitcoin relies on the PoW model. However, there are no immediate plans to move Bitcoin to the PoS model.
How the New Ethereum Blockchain will Work
The transition to the proof of stake model is the biggest milestone in the deployment of Ethereum 2.0. It will be secured using the staking of Ether. As the ether is used, those who stake will receive rewards. In this model, people will have to buy Ether to earn rewards.
One major advantage of this new model is that it uses 99% less energy than the PoW model. Besides that, it has been claimed to be easier to scale. In theory, it would eliminate the need to run massive crypto mining operations, which has become a major business in regions of the world with cheap power.
Whether the new model is good for the Ethereum ecosystem has yet to be determined. However, many expect that the blockchain will be faster, and easier to scale. As a result, it will be easier to deploy products that can compete with those offered by centralized service providers.
What Will Happen to the ETH Holders when Ethereum Merge Happens?
Some are worried about what the new deployment means for their ETH hoard. After all, some have been HODLing their coins for years and are worried about the future. However, they need not worry. The team has been working on the protocol for years, preparing for such an issue. In general, they will not need to do anything. Their ETH will not lose value, and they will simply move to Ethereum 2.0 without any effort on their part.
What It Means For the DeFi Sector
The Merge could make Ethereum more appealing for layer 2 protocols. Ethereum is already the base chain for over 300 decentralized apps. Under the new model, the apps could enjoy better speed, and scalability, boosting participation in the DeFi world.
Everyone expected the launch of Merge to happen in June. However, the delay shows that the team is taking every measure to ensure it is a smooth transition. With so much riding on the transition, everyone is hoping the transition is a smooth one.
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