Bad news for Ethereum (ETH), forced to postpone its highly anticipated update to summer 2022

After a few weeks of speculation, lead Ethereum developer Tim Beiko confirmed in a tweet on Tuesday that the long-awaited Ethereum merger will come later than expected. Instead of June, Beiko said the pass of the network to the proof of participation (Test of the stack or PoS) it is more likely to occur “within a few months”.

Beiko insisted that Ethereum was “in the final chapter of PoW“, But it is yet another long series of delays for a project that had to be completed soon 2019 .

The update comes after Ethereum hit a major milestone on Monday with the first shadow fork of the core Ethereum network, which amounts to dry proof of the upcoming network change in consensus mechanisms.

However, according to a tweet Ethereum DevOps engineer last weekend Parathi JayanathiThree recent phantom forks of Ethereum’s Goerli testnet have revealed bugs that still need to be fixed before the update is ready.

The merger means Ethereum’s transition to a proof-of-stake (PoS) mechanism to protect itself. Today, the network is based on a resource-intensive Proof-of-work (PoW) system similar to that of Bitcoin, in which a decentralized network of computers competes to validate transactions.

Ethereum’s move to PoS, where users retain the ability to secure the network by “disconnecting” the ether, is expected to reduce energy costss of the network by 99% and facilitate Ethereum scaling.

However, building a new consensus mechanism for Ethereum involves considerable complexity. In addition to introducing a number of engineering challenges, Ethereum’s PoS model will add a new set of game theory mechanisms to ensure that network validators are acting in good faith.

With billions of dollars at stake, one misstep would be catastrophic for the entire ecosystem.

Move focus to layer 2

Even after the merger, Ethereum’s high gas tariffs and relatively low speeds, which made the network unusable for many applications, are likely to persist.

Ethereum is at the heart of decentralized finance (DeFi), GameFi, and NFT, but a slew of new POS chains are hot on Ethereum’s heels offering users faster and cheaper transactions.

The merger supplanted Ethereum’s original plans for “Ethereum 2.0,” which included the addition of sharding to improve network throughput by breaking the business into chunks that can be processed simultaneously. Sharding is still on the Ethereum roadmap, but has been postponed to 2023 to accelerate the move to PoS.

With this in mind, much of the attention within the Ethereum developer community has turned to tier 2 rollups like Arbitrum, Optimism, and Loopring, which have amassed billions of dollars in total value tied to their third-party solutions. to scale the Ethereum network.

Even after the merger, a growing portion of network activity is expected to move to these tier 2 networks, which process transactions on separate blockchains before aggregating and forwarding them to the base tier of Ethereum.

Although level 2 solutions have unique advantages and disadvantages over Ethereum, they tend to be much faster and cheaper than the basic level while still maintaining essential security measures.

Ethereum’s native token, ether (ETH) is the the second largest cryptocurrency. At press time, it had a market cap of $ 365 billion and was trading at $ 3,100, up from around $ 3,500 at the start of the month.

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