The Merge was the September 2022 upgrade in which Ethereum switched from proof of work mining to proof of stake, cutting the network’s energy use by roughly 99.9% without changing how users hold or send ETH. It joined Ethereum’s original blockchain with a separate proof of stake chain called the Beacon Chain.
Many beginners still wonder whether the Merge made transactions faster or fees cheaper (it did not), and what happened to the miners. This guide explains the before and after in plain language, what the upgrade achieved, and what it left for later improvements.
Key takeaways
- The Merge took place on 15 September 2022 and replaced miners with validators who lock up ETH as a security deposit.
- Ethereum’s energy consumption fell by about 99.9% according to estimates published by the Ethereum Foundation and independent researchers.
- Users did not need to move or convert their ETH, and balances, addresses and apps carried on as before.
- The Merge did not make fees lower or transactions faster. Scaling is handled mainly by layer 2 networks.
- Staked ETH could not be withdrawn until a later upgrade in April 2023.
Ethereum before the Merge
From its launch in 2015 until 2022, Ethereum used proof of work, the same basic system as Bitcoin. Miners competed with powerful computers to solve puzzles, and the winner added the next block and earned newly created ETH. This secured the network but consumed large amounts of electricity. For a deeper comparison, read proof of work vs proof of stake.
Ethereum’s developers had planned a move to proof of stake from the beginning. The change was delayed for years because it is difficult to alter the foundations of a live network that secures tens of billions of dollars in value. The plan was to build the new system next to the old one, test it thoroughly, and then connect the two.
How the Merge worked
The upgrade happened in stages, and it is easier to understand as a timeline.
| Step | What happened |
|---|---|
| Beacon Chain launch (December 2020) | A separate proof of stake chain started running in parallel, with validators depositing ETH. It did not process user transactions yet. |
| London upgrade (August 2021) | Introduced fee burning, so part of every transaction fee is destroyed instead of paid out. |
| Merge (September 2022) | The original chain, where all the apps and balances lived, began taking its block production from the Beacon Chain. Mining ended. |
| Shanghai and Capella upgrades (April 2023) | Allowed validators to withdraw staked ETH and rewards. |
The word “merge” is exact. The existing execution layer (accounts, smart contracts, balances) was joined to the new consensus layer (the part that decides which blocks are valid). Nothing was copied to a new chain, so the history and every wallet stayed intact.
Miners, validators and staking
After the Merge, new blocks are proposed and checked by validators. To become a validator directly, a person must deposit 32 ETH and run software that is online around the clock. Validators earn rewards for doing their job correctly. If they act dishonestly or are careless in specific ways, part of their deposit can be destroyed, which is called slashing.
Because most people do not hold 32 ETH or want to run a server, staking services and pools let users take part with smaller amounts. These carry extra risks such as smart contract bugs and provider failure. Our guide to crypto staking covers the options.
- Proof of work: security comes from electricity and hardware spent on mining.
- Proof of stake: security comes from capital locked up and at risk of being slashed.
- Former miners: Ethereum mining hardware could no longer earn ETH, and some miners moved to other coins or different work.
What changed and what did not
The clearest change is energy use. Because validators do not race to solve puzzles, ordinary computers are enough. The new issuance of ETH also fell sharply, since validators need far smaller rewards than miners who had electricity bills to pay. Combined with fee burning, there have been periods when more ETH was burned than created, though this depends on network activity and is not guaranteed.
Several things stayed the same, and some beginners expect otherwise:
- Gas fees did not fall automatically, because the network still has limited space in each block. Read gas fees explained to see what drives them.
- Transaction speed was nearly unchanged. Blocks come at a steady rhythm of about 12 seconds.
- Your ETH, addresses and tokens did not change. No action, swap or new wallet was needed.
- The Merge was not an investment event. Anyone claiming a Merge “airdrop” or “upgrade” for your coins was most likely running a scam.
Scaling is being tackled mostly through layer 2 networks and later upgrades to how Ethereum stores data. The Merge was one piece of a longer roadmap, not the finish line.
Why the Merge mattered
Beyond energy, the Merge showed that a large, live blockchain could change its core security system without stopping and without users losing funds. That was a technical milestone for the whole industry. It also changed how people discuss Ethereum: environmental criticism of its electricity use largely fell away, and the debate moved to decentralisation and regulation.
A simple example, using round numbers only: if a network once used the electricity of a small country and afterwards used about as much as a few hundred households, the saving is the headline result. Exact figures vary by estimate and method, so treat any single number with caution.
The upgrade also set up the next steps. With staking in place, the network can add features such as better data handling for layer 2 networks. For the user, the practical lesson is simple: upgrades are announced publicly, they rarely need action from you, and anyone asking you to act urgently is a red flag.
Risks and criticisms
Proof of stake is widely accepted today, but it is fair to know the debates around it.
- Wealth concentration: critics argue that staking rewards flow to those who already hold the most ETH, and that large staking providers hold significant influence.
- Centralisation risk: if a few services control a big share of staked ETH, they could become a point of failure or pressure.
- Complexity: the system is more complicated than proof of work, which means more places for bugs. So far, the network has run without a major failure of the consensus itself.
- Regulation: staking services may be treated differently by regulators in different countries.
Supporters respond that the energy savings are real, that attacking the network would require enormous capital that could be slashed, and that anyone can run a validator. As with all of crypto, this is a trade-off, not a perfect solution, and nothing here is financial advice.
What was the Ethereum Merge in simple terms?
It was the moment Ethereum stopped using miners and began using validators who stake ETH. The network and its apps kept running, but the way new blocks are agreed on changed completely.
Did I need to do anything with my ETH during the Merge?
No. Balances and addresses stayed the same. Messages asking you to “upgrade” or “claim” something because of the Merge were scams.
Did the Merge lower Ethereum fees?
No. Fees depend on demand for block space. The Merge changed how blocks are produced, not how many transactions fit in each block.
Can Ethereum still be mined?
No. Mining ETH ended with the Merge. Some separate chains that kept proof of work exist, but they are different networks with different coins and value.
Is proof of stake safer than proof of work?
They have different security models and different risks. Proof of stake uses far less energy and has strong penalties for cheating, while proof of work has a longer track record. Neither is risk-free.
Next step: compare the two systems in proof of work vs proof of stake, and review the basics in what is Ethereum.
