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No big bills to pay beyond an ordinary computer and an internet connection, so the yield just has to reflect the opportunity costs and risks involved. This requires a big issuance that is quickly sold for fiat to pay the bills.įor PoS you just need to give some yield to stakers to make people want to deposit capital rather than just invest it elsewhere. Lower security costs since there’s less energy needed to achieve consensus.įor PoW you need miners to be able to at least cover all the hardware and energy they use otherwise no one will mine. PoS: “It costs too much to mess up with the order of blocks, because if I do I’ll lose all the money I put up as collateral."Why merge? PoW: “It costs too much to mess up with the order of blocks, playing by the rules is more lucrative.” Both PoW and PoS achieve consensus by different means: If you don’t know, “consensus” is just a fancy word for the goal of ordering transactions and getting some economic guarantee that this order won’t change. It’s called “merge” because it’s about merging the Beacon Chain ( consensus layer) with the current chain ( execution layer) and ditching the proof of work part of the execution layer. Everything sames exactly the same, only the consensus mechanism changes. You will still hold the same amount of ETH after the merge, there is no “ETH2 coin”, no need to migrate anything, etc. If you currently hold ETH, you don’t need to do anything.
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The Merge is not “ETH 2.0”, there is no ETH 2.0, it’s an obsolete term. When the merge happens, Ethereum will be secured by Proof of Stake instead of Proof of Work. I’ve already seen this to a degree with last week’s announcement that the Kiln testnet successfully merged, and I expect to see much more of the same stuff going forward so here are a bunch of common questions/takes I see, boiled down in quick bullet points like I did in my previous post that was more about Ethereum in general.I plan on lazily linking this thread whenever I see those points being brought up, and I encourage everyone to do the same and correct me if I got anything wrong or suggest any addition.Wat merge?Ī lot more info can be found on so I will keep this section light As the merge approaches, more news and poorly informed crypto-journalist articles will come out, signaling to more people that it is indeed close, and this will bring more Proof-of-Stake related questions and discussions rehashing the same topics and same misconceptions.