Ethereum merger: It may be the biggest event in the encryption field this year. Is everyone ready?

Vitalik 2025-10-14 11:55 22365人围观 ETH

This is the original author of the 1647th issue of Vernacular Blockchain| Produced by Terry | Vernacular Blockchain (ID: hellobtc) The pledged amount of Ethereum 2.0 exceeds 12.6 million pieces, reaching a record high: According to reports on May 16, data

This is the 1647th original issue of Vernacular Blockchain
Author | Terry
Produced | Vernacular Blockchain (ID: hellobtc)

The pledged amount of Ethereum 2.0 exceeds 12.6 million, a record high: According to reports on May 16, data from the analysis platform Nansen shows that the pledged amount of Ethereum 2.0 has exceeded 12.6 million, accounting for 10.4% of the total circulation, setting a record high. The amount of Ethereum pledged on the Lido platform exceeds 4.1 million, accounting for 32.5% of the total pledged amount of Ethereum 2.0, which is also a record high.

On March 26, Ethereum core developer Tim Beiko summarized the contents of the latest core developer meeting, including the progress of the merged test network Kiln, difficulty bomb, Shanghai upgrade, Ethereum execution layer work progress, etc.

On April 13, Ethereum merger leader Tim Beiko responded on social media: The Merge will not be completed in June and is expected to be completed within the year. This not only means the real transformation of Ethereum from PoW to PoS, but also means that the so-called "Ethereum 2.0" is accelerating.

01
What is The Merge?

Just in January this year, the Ethereum Foundation announced that in order to prepare for the merger, the expressions "Ethereum 1.0" (ETH1) and "Ethereum 2.0" (ETH2) will be eliminated and replaced by the "execution layer" and "consensus layer." There is no doubt that this is making final normative literal preparations for the arrival of Ethereum 2.0.

In early December 2021, Vitalik Buterin published an article titled "Endgame", proposing the eventual integration of all blockchains in the future, and also listed tools that allow block verification to occur in a decentralized and censorship-resistant manner.

In short, Ethereum's beacon chain currently runs separately from the main network. Although the beacon chain runs in parallel using the PoS consensus mechanism, the current Ethereum main network continues to be protected through the PoW consensus mechanism.

The Merge is the final integration of these two systems - when ready, the Ethereum mainnet will merge with the beacon chain, and the mainnet will introduce the ability to run smart contracts as well as the complete history and current status into the PoS system.

That is, after the merger, existing Ethereum mainnet clients ("execution clients") will continue to host the Ethereum Virtual Machine (EVM), and verify and broadcast exchanges, but will stop participating in proof-of-work (PoW) mining and relinquish responsibility for reaching consensus on the blockchain chain header (top block).

Instead, this consensus will become the responsibility of the "consensus client", which is responsible for packaging the exchanges from the "execution client" together with the information required for consensus into "beacon blocks", and these beacon blocks form the beacon chain. “"Miners" will be replaced by "validators", who need to deposit ETH into an Ethereum smart contract (i.e. stake):

The ETH staked by validators will serve as collateral to incentivize them to complete the verification work correctly. Validators who do not perform verification work (for example, because they are offline) or conduct malicious behavior will cause part of their staked ETH to be destroyed. On the other hand, if the validator behaves appropriately, they will be rewarded with ETH.

This marks the end of the Ethereum PoW consensus mechanism, and also means that once the merger occurs, stakers will verify the Ethereum main network. The entire Ethereum network no longer requires GPU mining, and previous miners may invest in the new PoS system.

02
What are the possible impacts of The Merge?

According to an information session hosted by ConsenSys, three researchers working on merging technologies believe that the merger of the Ethereum mainnet and the PoS beacon chain will reduce network energy usage by at least 99.95%.

The blockchain consists of three parts: consensus layer, execution layer and data availability layer. The merger is an upgrade to the consensus layer, but the gas fee is paid to the execution layer.

This means that The Merge will change the PoW consensus to POS, and the PoW chain will not produce new Ethereum. The new Ethereum will only be produced from PoS, which will reduce energy usage but will not affect Gas costs.

According to current data estimates, after Ethereum switched to the PoS mechanism after The Merge upgrade, the number of new Ethereums added to PoS every year is about 600,000. However, according to the on-chain destruction data after the Ethereum to London upgrade in 2021, it is expected that the number of Ethereum destroyed due to EIP-1559 in a year is about 4.7 million.

This means that from now on, the net destruction of Ethereum will be greater than the net output, which is -4.1 million. Combined with the current number of Ethereum of approximately 120 million, Ethereum will not only not be issued additionally every year, but will also be in a state of deflation:

(0.6M POS - 4.7M burn)/118M = -3.5%

This will undoubtedly provide strong support to prices from the supply side. At the same time, with the advancement of Eth2 and the imminent implementation of the London upgrade, facing the expectation of destruction, coupled with the demand for PoS, ETH will undoubtedly become more scarce, which is the most powerful boost to currency prices at the demand level.

At the same time, although the current staking APR is about 4.5%, and the income will continue to decline as the total number of ETH pledges increases, Jacob Franek, a core contributor to the Web3 startup accelerator Alliance, recently tweeted that Coinbase expects the ETH staking annualized rate of return (APR) to rise to 9-12% after the merger (The Merge).

In fact, from this perspective, the act of pledging at least 32 ETH to obtain rewards can be simply compared to "Ethereum graphics card mining" under the new situation - every 32 ETH can be compared to a mining machine, and the reward generated by staking is the mining output.

03
Ethereum staking track overview

However, before participating in Ethereum staking, we need to clarify some unique mechanism designs in Ethereum staking, because this is directly related to the specific participation methods currently available on the market.

At least 32 ETH. When participating in staking, you must deposit at least 32 ETH (or a multiple of 32) into the deposit contract, which is undoubtedly a high capital threshold for most users. ；

Slash punishment. Slash penalty means that the pledged node is punished for not complying with the agreement (basically around the technical operation and maintenance level), that is, the money is deducted from at least 32 ETH pledged in the node. If the node's pledged ETH Token drops below 16 due to the accumulation of Slash penalties, the node will automatically withdraw from the network. ；

It can be seen from the above that small amounts of ETH cannot participate, the technical threshold of verification nodes, and the liquidity of pledged tokens are issues that require direct attention when participating in staking. The targeted ETH staking services currently on the market can basically be summarized as "two categories and four models."

Hosted

The biggest advantage of hosting is that it encapsulates the technical threshold of node construction and maintenance. Ordinary users don’t have to worry about hardware and software settings, Slash penalties, etc.

Fully managed
Fully managed users do not need to worry about the operation and maintenance of verification nodes. The custodian institution will handle all node affairs. Users only need to transfer the ETH participating in the pledge to the custodian institution. The custodian institution will 100% manage and operate the validator nodes for the users and extract profits from the pledge income.

Users can also pledge small amounts (less than 32 ETH), because the custodian can help small pledgers gather 32 ETH to participate in the pledge.

But similarly, users no longer have control over the assets during the staking period, and once they are attacked, the user's assets will face greater risks. At the same time, users cannot know details such as whether the custodian's validator online rate is stable, whether the income level is reasonable, and whether there has been any punishment.

It is not even known whether the assets under custody are used for pledge. The biggest fear is that "we are interested in the income, but others are concerned about the principal." Therefore, for the "complete custody" plan, the credit and brand of the custody institution are very important.
Staking pool hosting
On the basis of full custody, the pledge pool solution not only supports small-amount (less than 32 ETH) pledges, but can also solve the liquidity problem caused by long-term lock-up of pledge funds.

The most representative ones are naturally the Ethereum staking related services of major CEXs such as Binance and OKX. The basic model is to lock ETH on the corresponding interface of the trading platform. The minimum quantity requirement is only 0.1 or other lower levels, which is equivalent to staking on the trading platform. The trading platform collects the tokens of platform users and locks them through official channels.

The biggest advantage is one-click fool-proof staking, which does not require at least 32 ETH, and also provides liquidity in the form of centralized guarantee.

In addition, not only CEXs, but also specialized Ethereum staking protocols such as Lido Finance and Rocket Pool can also allow users to obtain staking benefits without locking ETH. The solution idea is similar - issuing stETH at a ratio of 1:1 to make up for liquidity (taking Lido as an example):

Lido deposits ETH into the Ethereum smart contract and receives stETH as a receipt. The balance of stETH Token is adjusted over time to reflect the distribution of staking rewards generated by the contract.

Currently, from the perspective of user deposit balances, the top two ETH liquidity staking service providers are Lido Finance and Rocket Pool. Among them, Lido occupies an absolutely dominant position, with more than 12.6 million Ethereums as of May 16, leading the pack.

Unmanaged

Non-custodial means decentralized, and the difference between it and custody is the difference between DEX and CEX, that is, the control of ETH assets is always in your own hands.

Self-built node
The most direct non-managed form is for users to run the client and run and maintain nodes by themselves, but it requires strong technical strength and node operation and maintenance experience.

Therefore, the advantage is that users have complete control over self-built nodes and there is no centralization risk of centralized hosting. However, the disadvantage is that it requires high funds and professionalism, making it difficult for ordinary users to participate.

semi-hosted
After the wallet on the beacon chain is created, two sets of keys will be generated, namely the withdrawal key and the validator key:

A withdrawal key that allows us to withdraw your ETH and rewards when the (beacon chain) withdrawal function is launched (which may take another year)；

Verifier key, the signing key that the verifier software actually needs to use when verifying the beacon chain.

The withdrawal key and the verifier key do not need to be controlled by the same entity, which provides greater flexibility for the service form of ETH staking, and is also the core idea of semi-custodial solutions represented by imToken and others:

Compared with the self-built node solution, the "semi-custodial" solution allows the verifier key and the withdrawal key to be kept separately, thereby helping users solve the problem of operating and maintaining nodes by introducing third-party node service providers, that is, asset control and ownership are still in the hands of the user.

This kind of design is actually similar to EOS, DOT, ATOM, IRIS and the like, which are entrusted to professional nodes, but the asset control rights are still in their own hands. The shortcoming is that it also requires at least 32 ETH, and the capital threshold is relatively high, but the advantages are also obvious:

Asset control and ownership are owned by the user, and the service provider cannot control the user's principal and income. The pledged funds completely correspond to the verification nodes on the Eth2 chain, the node status is transparent and visible, and the online rate and income level can be tracked in real time.

04
summary

Overall, Vernacular Blockchain summarizes the respective characteristics and advantages of these "two categories and four models" as follows:

If I could sum it up in one sentence, it would be:

For most ordinary users with long-tail needs, based on their professional technical capabilities and capital threshold restrictions, custody is definitely the first choice, and for liquidity considerations, pledge pool > full custody.

In addition to long-tail demand, users with sufficient funds themselves do not have the technical strength and node operation and maintenance experience, so semi-hosted > self-built nodes； Even if you have technical strength and node operation and maintenance experience, from a cost perspective, it is still semi-managed > self-built nodes (of course, friends who are sentimental, regardless of cost, and not afraid of trouble will tell you otherwise).

END

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『Statement: This article is the independent opinion of the author and does not represent the position of vernacular blockchain. This content is only for popular science learning and communication among crypto enthusiasts. It does not constitute investment opinions or suggestions. Please treat it rationally, establish correct concepts, and improve risk awareness. The copyright and final interpretation rights of the article belong to Vernacular Blockchain. 』

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