Ethereum just completed The Merge — here’s how much energy it’s saving

Technology
Illustration by Alex Castro / The Verge

The Merge, which took place early Thursday morning ET, will cut Ethereum’s energy consumption by an even bigger margin than previously expected, a new analysis finds. It’s also expected to slash the cryptocurrency network’s greenhouse gas emissions dramatically.

Ethereum’s electricity use is expected to drop by a whopping 99.988 percent post-Merge, according to the analysis published today by research company Crypto Carbon Ratings Institute (CCRI). The network was previously using about 23 million megawatt-hours per year, CCRI estimates. Moving forward, it’s expected to use just over 2,600 megawatt-hours per year. To help visualize just how massive this is, the report compares this reduction to the Eiffel Tower shrinking to the size of a Lego toy person.

says is slightly less than the amount of energy 100 homes in the US would use in a year.

The new report was commissioned by ConsenSys, an Ethereum software company. Ethereum co-founder Joseph Lubin also founded ConsenSys, which was also involved in the research and development of The Merge.

The report is in line with other estimates. Alex de Vries, a researcher who runs the website Digiconomist that tracks Bitcoin and Ethereum energy use, similarly estimates that Ethereum’s electricity demand has fallen “99.98%, which comes down to possibly as much as a country like Austria requires.” Before The Merge, the Ethereum Foundation had estimated that the software update would reduce energy use by 99.95 percent.

The enormous pollution reduction comes from a change in how Ethereum users earn new tokens. (For more details, check out our in-depth explainer on how that happened.) With The Merge, Ethereum is getting rid of a mechanism called proof of work that uses vast amounts of computing power to validate blocks of new transactions. Proof of work required crypto miners to solve computational puzzles, an extremely energy-intensive process, in order to validate new blocks on the chain and earn new tokens in return.

Now, Ethereum uses a new mechanism called proof of stake that gets rid of puzzles and mining. Instead, validators need to stake some of their tokens for a chance to validate new blocks of transactions and be rewarded with tokens in return.

You still need computers to store data and verify transactions. And validators will probably still run their hardware around the clock. But their hardware won’t be nearly as energy-hungry as crypto miners’ data farms. The small discrepancies in estimates for energy consumption post-Merge have to do with how many validators there are, what kind of equipment they’re using, and whether it runs on clean or dirty energy.

The successful launch of The Merge places greater pressure on other cryptocurrencies still using proof of work. The elephant in the room is Bitcoin, which is currently estimated to gobble up more electricity per year as the country of Kazakhstan.

“[The Merge] is hopefully a step into a more sustainable future for cryptocurrencies,” says Uli Gallersdörfer, co-founder and CEO of the CCRI.

proof-of-work Ethereum blockchain alive, which could limit the total energy savings.

“It does mean that the total amount of energy that’s going to be saved here [with The Merge] could be less than 99.99% if there is a proof of work Ethereum surviving and it continues to support some amount of mining activities,” says de Vries.

How much pollution that rogue chain is responsible for will depend on how valuable its new token is, which is expected to officially launch within a day. The value has to be high enough to sustain miners’ energy costs, after all. The price of that forked Ethereum token briefly surged in the hours immediately after The Merge before quickly falling.

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