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Popular cryptocurrency blockchain Ethereum has completed its long-awaited switch to proof-of-stake. That upgrade process, better known as “The Merge”, has been years in the making. According to the Ethereum Foundation, today’s transition reduces Ethereum’s energy consumption by 99.95%.
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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. The successful launch of The Merge places greater pressure on other cryptocurrencies still using proof of work.
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The price of ether fell on Thursday after the migration. Ether was last down 5.6% to $1,501.88, after falling as low as $1,459.00 earlier in the day. Despite this, investors have been cheering Ethereum’s planned tech upgrade for months for its ability to turn ether into a yield-generating asset and to improve the security of the network in an energy-efficient way.