The Ethereum Merge and the Impact on Non-Fungible Tokens.
The recent buzz in the blockchain industry would be the Ethereum merge. You know, around 95% of the NFTs live on the Ethereum blockchain. In addition to that, a lot of NFT gaming platforms and NFT marketplaces use the Ethereum chain. What is this Ethereum merge, and why is it important? Do you own an NFT that is in Ethereum and is confused if there will be an impact or something on your NFTs that are safe in your wallet? Here is everything you should know about the Ethereum merge and how is it playing a role in Non-Fungible Tokens.
NFTs and the Merge!
If you ask what will happen to my NFT after the merge, the answer is simple. There will be no change on your NFTs in your wallet. They are safe. They will function the same in Dapp like NFT gaming platforms and in marketplaces. So what is the Merge? Why is it good for the Non-Fungible Tokens?
The Ethereum blockchain is using the Proof of Work consensus mechanism to process a transaction. This is where a group of miners solves a complex problem and verify the transactions. This consumes a lot of energy and an exclusive setup for a miner to do so. The miner will get ETH as a reward for the work he does. Since this is consuming a lot of energy and comes with a lot of scaling problems, Ethereum has been working for years now to move from Proof of work to proof of stake.
Proof of stake consensus mechanism validation takes place after selecting a random miner who has staked or pledged pre-existing ETH. New ETH is created and rewarded to these miners randomly. This method does not need any special equipment set up, and it also consumes less energy.
It is estimated that the energy consumption will reduce up to 99% after the merge. That is, change from PoW to PoS. This energy reduction also includes the carbon level for every NFT transaction. Due to this, NFT transactions on the Ethereum blockchain will become faster and more cost-efficient.
The Bottom line
The merge will be done within late 2022, and this will be a big thing for the Ethereum blockchain users. The NFT marketplaces and NFT gaming platforms will be the first to get benefitted from this, with high transaction speed than before with low transaction fees. The merge is happening stage by stage, and after the final stage, the users will experience the Ethereum in Proof of Stake completely.