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Celebrating the Ethereum Merge Anniversary: A 99% Decrease in Energy Consumption, Yet Lingering Concerns of Centralization

Celebrating the Ethereum Merge Anniversary: A 99% Decrease in Energy Consumption, Yet Lingering Concerns of Centralization

– Ethereum has experienced a significant reduction in energy use and improved network access since transitioning to proof of stake.

– The Merge, which occurred in September 2022, shifted Ethereum from a proof-of-work to a proof-of-stake consensus mechanism, resulting in a drastic decrease in power consumption.

– The Ethereum network has seen its energy use drop by over 99.9% since the transition.

– The Merge also made Ethereum economically deflationary, with more ETH being burned than issued, leading to a reduction in the total supply of ETH.

– However, the price of ETH has not experienced a significant surge due to external factors such as the banking crisis and inflation.

– The introduction of stakers through the Shapella upgrade has driven a shift towards liquid staking providers like Lido and Rocket Pool.

– Liquid staking providers currently dominate the Ethereum landscape, with Lido accounting for 72% of all staked ETH.

– Concerns have been raised about the level of control granted to staking providers and the potential centralization of validation on Ethereum.

– Regulatory pressure against crypto and blockchain in the United States is a pressing concern for Ethereum’s future.

– Client diversity and reducing centralization through statelessness are key issues that need to be addressed for Ethereum’s long-term decentralization.

– Vitalik Buterin has highlighted the need for easier node operation and reduced costs and hardware requirements through statelessness.

– These centralization issues may take another 10 to 20 years to solve.

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