After 200 days of transitioning from a proof-of-work consensus mechanism that consumed more energy to a proof-of-stake mechanism, the Ethereum network has seen positive changes. The Merge upgrade, which occurred in September 2022, resulted in a decrease in rewards for network operators. Along with the introduction of a burning mechanism (burning a portion of fees through transactions), this process reduced the supply of ETH.
After The Merge, the total supply of Ethereum decreased by approximately 75,000 ETH (worth $134.5 million), corresponding to an annual decrease of 0.114%. If this event had not occurred, the supply of ETH would have increased by an additional 2.2 million coins (worth over $4 billion at current prices).
However, after The Merge, a large amount of ETH staked on the network still cannot be withdrawn to wallets. Therefore, investors can only withdraw their funds after the highly anticipated next Ethereum upgrade, Shanghai, is completed.
As reported by Interlock, Ethereum Foundation announced on March 28th that the Shapella upgrade will take place at epoch 194,048. An epoch on Ethereum consists of 32 blocks, and this epoch is expected to occur on April 13th at 5 am.
In addition, the Lido Finance protocol expects that withdrawals of staked ETH will not be enabled on the main network until mid-May. This is when all network verification and security checks are completed. The project also noted that the waiting time may be extended due to some on-chain technical limitations. Additionally, Lido revealed that it spent $1.2 million on seven audits for Lido V2. This operation aims to address any potential vulnerabilities that could impede the platform’s performance.
The transition to proof-of-stake mechanism has been a long-awaited and highly anticipated event for the Ethereum community. While the reduced supply of ETH may have affected some investors, the shift to a more energy-efficient and environmentally friendly consensus mechanism has been a positive development. With the upcoming Shapella upgrade and the potential for ETH withdrawals, the Ethereum network is poised for further growth and development in the future.
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This article was republished from azcoinnews.com
