The Merge is finally over, and the crypto market is breathing a sigh of relief. A lot was riding on the successful execution of the Merge. In fact, Ethereum Foundation had been carefully planning for the transition to Proof of Stake (PoS) and removing roadblocks for over two years.
During all this time, a lot has been said about the Merge. Yet, there are many things about it that leave people confused, and there are many myths to bust in relation to ETH 2.0. In this article, we focus on the top five myths in an attempt to set the record straight.
Myth 1: Ethereum will be able to process 1,00,000 transactions per second soon after the Merge.
Fact: No, Ethereum will not be able to process 1,00,000 transactions per second soon after the Merge. The Merge is just a transition from Proof of Work (PoW) to the Proof-of-Stake (PoS) mechanism of verifying transactions. Only after its successful execution, will the scaling of the Ethereum network begin.
The journey to 1,00,000 transactions per second will get started after 6 September 2022, in a phased manner, through the implementation of shard chains. These shard chains will split the blockchain and create parallel chains, which will handle multiple transactions instead of a single chain, thus speeding up transactions.
Myth 2: The gas fees on Ethereum Network will reduce.
Fact: No, the gas fees or transaction fees on Ethereum will not reduce after the Merge. The Merge will be changing how blocks are created. It doesn’t address how individual transaction costs can be reduced.
The gas fees will stay around the same level as under the PoW mining system. The fee is expected to start reducing only once the shard chains are implemented—around 2023.
Myth 3: Users will be able to withdraw their staked ETH after the Merge.
Fact: No, users staking their ETH tokens, or validators who have staked their ETH tokens in the Beacon Chain, cannot withdraw them soon after the Merge.
The tokens will remain locked until the completion of the Shanghai upgrade, which is expected to be completed 6–12 months later.
However, users have the option of exchanging their staked ETH tokens with stETH tokens and liquidating their holdings.
Myth 4: The Merge will create a new token ETH 2.0.
Fact: No, this is completely baseless and false. The Merge is not a hard fork that will see a split in the blockchain and the creation of a new token. It is simply a step to replace the energy-hungry PoW mechanism with the more energy-efficient PoS one.
Beacon Chain is the name of the blockchain being used to introduce PoS to Ethereum. In the Ethereum roadmap, the term ETH 2.0 is used to refer to the Beacon Chain.
Myth 5: The transition to ETH 2.0 is coming in one fell swoop.
Fact: The Merge is not the last upgrade toward making Ethereum more scalable and energy efficient. Ethereum will undergo further upgrades in the future—namely surge, verge, purge, and splurge. As Vitalik Buterin says, the upgrades are key parts of Ethereum’s scaling, cleanup, and evolution.
The surge refers to the implementation of shard chains; the verge will implement “Verkle trees” and stateless clients, and the purge will help eliminate some old network history to free up space on the hard drive. Finally, the splurge, comprising various small upgrades, will fine-tune the network to ensure seamless operations.
The Merge is a ground-breaking development for the entire crypto ecosystem; nothing of this sort or size has been executed ever before. As a user, you are therefore going to be excited by all the news coming in around it, but it is important to look for reliable sources so that you don’t fall prey to rumors.