An update on The Merge – On September 15, the network Ethereum was finalizing his moving from Proof of Work to Proof of Stake. This historical update changed many network settings. On the occasion of 100 annual days of The Merge, Galaxy has published a report that examines the changes that have taken place.
The merger: 100 days and yet many changes
On December 13, on the occasion of 100-day deployment of The Merge, Christine Kim published a report for the company galaxy. This describes the changes that have taken place on the Ethereum network.
As a reminder, on September 15, the ethereum network finally abandoned Proof of Work in favor of Proof of Stake. As a result, miners who provided block verification and assurance have been replaced by validation nodes.
title Unionthis transition was marked by the connection ofexecution layer (Ethereum’s application layer) at consensus layer provided by chain beacon.
One hundred days later, the Ethereum network has changed a lot, and on many levels.
Block down time and number of blocks up
The move to Proof of Action is activated improves block time predictability. As a reminder, block time or block time is the time it takes for a new block to be added to the blockchain.
This better predictability has given rise to another phenomenon. Indeed, it led to a decrease in blocking time, which went from 14 seconds before Merge to 12 seconds after. Who says block time reduction, says more blocks are produced in a day.
“The number of confirmed blocks per day has increased significantly, from a daily average of around 6,000 blocks before the merger to over 7,000 blocks in the last 100 days. »
ETH emission reduction
The move to Proof of Action has too affected the production rate of ETH. Thus, where 15,000 ETH were produced daily before the merger, the network produces none now. more than 1800.
Moreover, this production was compensated by the mechanism of systematic destruction of part of the costs, presented by IEIP 1559. Therefore, ETH’s annual inflation rate has dropped from 4 or 5% to just 0.12%.
Mev-Boost: increasing adoption
In parallel with the merger, validators had the opportunity to fully participate and benefit from the Maximum Extractable Value (Maximum Extractable Value, MEV). To do this, they can use additional software called Mew Boost.
“It allows them to connect to multiple third-party relays, off-chain marketplaces where pre-built blocks that are optimized for MEV can be auctioned off. »
In practice, MEV rewards have remained relatively stable since the merger – except for the days surrounding the FTX drop. The use of Mev-Boost has exploded. Thus, about 80% of evaluators have approved Mev-Boost.
Mev-Boost: the censoring problem
Although Mev-Boost has allowed validators to increase their income, it has not only advantages. Indeed, as we have already discussed many times, an important censorship phenomenon has emerged from the use of Mev-Boost.
Thus, it is estimated that approx 57% of blocks products in the 100 days after the Merge exhibited a systematic censorship of transactions related to Tornado Cash.
Unfortunately, this phenomenon has tended to grow in proportion with the adoption of Mev-Boost.
Staking: a profitable business
The increase in earnings from SRM generated a increased income for verifiers. Thus, the latter benefit both from the income from block production and from MEV.
Therefore, the merger resulted in an increase in annual stock return. In this way, this went from about 4% to 6%.
Now the Ethereum network is looking to the future and set next March of its next fork: Shanghai. This will specifically mark the opening of withdrawals regarding ETH deposited in shares on the beacon chain.
Are you passionate about The Merge and Ethereum? Don’t wait any longer to prepare for the future. Register quickly on the Binance platform. You will save 10% on your trading fees by following this link (trade link).