The Ethereum Merge seems to have done its job and reduced emissions

A month after the Ethereum Merge and the energy consumption levels seemed to drop by the predicted 99.9 percent.

A report from the Ethereum Foundation shows that the move from proof-of-work (PoW) to proof-of-stake (PoS) has dramatically reduced power consumption.

Ethereum’s energy continues to maintain low energy usage. As a result, the network’s carbon footprint currently stands at 0.1 million tonnes of CO2 (MtCO2) per year.

The Ethereum Foundation said the Merge was the joining of the original execution layer of Ethereum (the fully developed blockchain Mainnet that has existed since genesis) with its new PoS consensus layer, the Beacon Chain.

It eliminated the need for energy-intensive mining and instead enabled the network to be secured using staked ETH and was a significant step in realising the Ethereum vision—more scalability, security, and sustainability.

According to Leigh Travers, CEO at Binance Australia, this move to proof-of-stake was a “Y2K moment” for the market and will be looked back upon as a pivotal moment in the inception of Web3 companies.

He explained, “Ethereum has been a preferred blockchain for many projects in recent years and has built up into a plus $100B network, so there were literally billions riding on the success of The Merge.

“This doesn’t even count the value of applications and NFTs hosted on the Ethereum blockchain which after a successful merge, will create a positive tailwind for all Ethereum stakeholders. For other Layer 1’s, they will be looking to replicate the smooth transition that the Ethereum community was able to manage for the most significant technological upgrade in crypto in the last few years.”

According to Web3 consultancy firm Vayner3, the Ethereum network is now a global leader in low energy consumption among digital networks.

They said, “The Ethereum network’s shift towards a PoS network has drastically altered its energy consumption footprint. All transaction volume on the US$150b+ Ethereum blockchain (DeFi, #NFTs, payments, trading) now looks negligible compared to Netflix streaming, Gold mining, and even PayPal transactions.”

The Ethereum merge will also reduce the amount of gas fees, which are payments made by users to compensate for the energy consumption made to process and validate Ethereum transactions.

As the merge was made to reduce energy consumption, this will have an impact on gas fees but not until next year.