Ethereum developers have reached another milestone on their way to the long-awaited ETH 2.0 network upgrade in June.
Last month, the Ethereum developers started working on The Merge, an upgrade to the Ethereum network to switch it from a proof-of-work to a proof-of-stake consensus model, and began testing how the switch would work on a Shadow Fork.
It means the end of proof-of-work mining on the Ethereum network. Mining, which involves the use of high-end computers to solve complex mathematical puzzles, is currently how new Ethereum coins are created and how transactions are verified on the network.
Once the network is switched over to proof of stake, "miners" will be replaced by "validators," to validate and secure the network and will be rewarded in Ethereum.
An essential piece of #Ethereum’s Serenity upgrade, the Beacon Chain’s deposit contract, is live. This begins a transition to #Eth2.@EthDotOrg Guide: https://t.co/PkKwLnXKS4
— Ethereum (@ethereum) November 4, 2020
Launchpad: https://t.co/CFgFwAs46f
Deposit Contract Address: 0x00000000219ab540356cBB839Cbe05303d7705Fa
The main reason and expectation for doing this is, that it will drastically reduce the amount of electrical energy consumed by the current Ethereum blockchain. It will also slash new ETH issuance by roughly 90%, which market analysts believe could add considerable deflationary pressure to Ethereum if demand for the asset remains high.
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