ethereum coin

Ethereum Gets an Upgrade

The “Arrow Glacier” Upgrade Arrives

The Ethereum (ETH) network is getting an upgrade today, dubbed “Arrow Glacier.” Developers are trying to delay what is being called a “difficulty bomb,” a glitch which could slow or halt mining on Ethereum, until June 2022.

The thinking is that Ethereum developers will have enough time between now and then to move the Ethereum network from a proof of work model to a proof of stake model. When that happens, the threat of the “bomb” will no longer be an issue. The upgrade is not expected to impact investors the way other changes of this kind have done in the past.

Shifting to a Proof of Stake Model

In Ethereum’s current proof of work model, miners compete against each other to validate transactions on the blockchain. That requires a lot of processing power which is negatively impacting the environment and causing some pushback. Next year, Ethereum plans to shift to a proof of stake model, in which users can validate transactions based on the number of Ether coins they hold. That will reduce the energy consumption required for mining.

Developers plan to push out the so-called difficulty bomb to encourage the network to move to a proof of stake blockchain. By delaying the bomb, developers have more time to shift the network.

Proof of Stake Requires Less Energy

Once the migration to Eth2 is complete, the Ethereum network will be easier to scale and secure. It will also require a lot less energy than a proof of work network. Some industry watchers predict it could reduce energy consumption by 99%.

While the upgrade that is coming today is not expected to impact Ether investors, a transition to a proof of stake may. Either way, one thing is for sure: as cryptocurrency and the blockchain evolve, developers are working hard to reduce their environmental impact.

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ABOUT Meg Richardson Meg Richardson is a writer specializing in markets, technology, and personal finance. She loves breaking down seemingly complex ideas and making them readable and interesting for everyone. She holds an MFA in writing from Columbia University. When she is not writing about finance, she enjoys running in Central Park and drawing cartoons.

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