successful transition for the Ethereum blockchain

“And we’re done! » Vitalik Buterin did not hide his satisfaction, Thursday, September 15. The co-founder of “block chain” (blockchain) Ethereum welcomes, in the social network Twitter, a particularly important technical change recently made to its platform, to make it more efficient and less energy intensive . “Everyone contributed to make Merge a success [“la Fusion”] feel so proud now”he added.

Nicknamed “The Merge”, this major technical change involves changing the way operations are validated on the Ethereum blockchain, a massive tamper-proof computer ledger that serves as the basis for billions of dollars in operations. The community behind this blockchain, led by Vitalik Buterin, has decided to move to a system that is considered less energy consuming: from a protocol based on “proof of work” (proof-of-work), Ethereum moved to another protocol based on “proof of stake” (proof-of-stake).

Read our explanations: what is Ethereum’s transition from “proof-of-work” to “proof-of-stake”

“No one has triggered an alert”

The stakes are high for the sector. True, ether, the cryptocurrency backed by Ethereum, represents only about 20% of the total value of current virtual currencies, which is half of bitcoin (40%), the most widely used cryptocurrency in the world. But Ethereum has a wider range of applications than its competitor, as it serves as support for many uses, such as the creation of NFTs (non-fungible tokens, digital certificates), games and applications. Making such a technical transfer when many services are based on this blockchain is therefore risky: the operation is often compared to changing the engine of an airplane mid-flight.

Also read: Crypto-art: more than 100 million dollars in NFTs stolen in one year

Next, the top global cryptocurrency exchanges – BinanceCoinbase, Bitfinex, Bitpanda… –, which suspended Ethereum-based exchanges during the transition period, announced that they are continuing operations, a sign of their confidence. The price of ether, moreover, was stable at noon, decreasing slightly around 1,595 euros for 1 ether.

“A priori, everything is fine, nothing triggers an alert” in the small world of cryptocurrencies, which communicate in real time on social networks, explained Agence France-Presse (AFP) Manuel Valente, on the French platform Coinhouse. “Decentralized financial applications”which makes it possible to borrow and lend cryptocurrencies and is the forerunner of Ethereum, “working properly”he added.

What future for “minors”?

One of the points to watch, however, in the coming weeks is the behavior of the former “miners” of Ethereum, whose role until now consists of validating transactions by solving more complex calculations, which requires powerful computers. With the proof-of-stake protocol, the validation of transactions no longer requires calculations (called “the work”) but proves that one has a share of the cryptocurrency in question (“the stake”). All the expensive machines that miners have invested in over the years are useless.

A small minority of them, against the moult of Ethereum, therefore decided to continue working in the old way. Two different validation systems therefore now operate in parallel, resulting in a branchesa branch, as it is called in the jargon of the crypto-asset world: the large register that compiles all transactions on the Ethereum blockchain is duplicated.

This kind of schism is already happening in the world of cryptocurrencies. If continued, such duplication will not doubt the overall credibility of the new Ethereum, but it may still cause a lot of technical problems, confuse ether holders and create risks of attacks.

Also read: At the Crypto Policy Symposium, skeptics of cryptoeconomics turned to resistance

The World with AFP

Leave a Reply

Your email address will not be published. Required fields are marked *