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The Merge

ethereum.org

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Re: The Merge

#171

Post by dsimmons »

encryptluks2 wrote: post #116
dsimmons wrote: post #80

Earlier quoted context omitted.

Gas fees don't materially change under Proof of Stake. It's a common misconception that The Merge reduces fees (it does not).

So what is the point of high fees under proof of stake? Before it was to reward the miners. Who exactly is being rewarded high fees once it changes and for what purpose? If the costs to run a validator are too expensive or need too many resources then you just end up promoting a centralized solution.

> If the costs to run a validator are too expensive or need too many resources then you just end up promoting a centralized solution.

If I recall correctly, the current number (32) was picked somewhat arbitrarily because, at least at the time, it was "enough" without being "too much" (in terms of incentives, skin in the game, and penalties for bad behavior).

I'd have to use a Googly device to find the price of Ether at the time when this decision was made, but I'm pretty sure it was a lot less than it was now. And once it'd been put into effect, it's difficult (e.g. unfair) to change it.

Longer-term, it likely won't remain so high, especially as the price of ETH appreciates. I believe I recall seeing discussions of changing this number in the future, but it's not the nearest-term priority.

For now, there are decent options around staking pools. Lido is the elephant in the room, but more and more people have been moving to Rocket Pool because it better promotes decentralization.

Re: The Merge

#172

Post by wmf »

Tao3300 wrote: post #61

> As we approach The Merge of Ethereum Mainnet, you should be on high alert for scams trying to take advantage of users during this transition. Do not send your ETH anywhere in an attempt to "upgrade to ETH2." There is no "ETH2" token, and there is nothing more you need to do for your funds to remain safe. Yeah... this is going to be a shitshow. Who wants to set the over/under on $millions that get stolen? Which exch…

You can easily steal millions in crypto with fake Elon giveaways, Metamask phishing, etc so I'm not sure fake merge social engineering is any worse.

Re: The Merge

#174

Post by DennisP »

alchemist1e9 wrote: post #133
pa7x1 wrote: post #114

Earlier quoted context omitted.

The HW requirements increase very very minimally. See this response on reddit: https://www.reddit.com/r/ethstaker/comments/nk9qzt/multiple_...

Do you see the same issue I see? I don’t understand why they aren’t concerned about it.

The hardware expense per node is very minor compared to the cost of 32 ETH, so it's a weak incentive to consolidate.

Weighed against that, the slashing penalties per node increase, the more nodes fail at once. That gives an economic incentive to decentralize.

Re: The Merge

#175

Post by latchkey »

seibelj wrote: post #168
latchkey wrote: post #155

Earlier quoted context omitted.

It wasn't a comparison about the power requirements between PoW and zk proofs. In other words: Switching to PoS, removes power allocated to GPUs for ethash mining. Adding ASICs for zk creates a requirement that doesn't exist today, for using power.

I believe the zk provers will only be for L2s. The base layer will always be the way it is now. The base layer will be settlement for various shards, as it is now for Arbitrum and Optimism.

I don't understand how that comment applies to the discussion. Are you implying that L2s are somehow lower power requirements?

Re: The Merge

#176

Post by dsimmons »

T0Bi wrote: post #145
encryptluks2 wrote: post #116

Earlier quoted context omitted.

So what is the point of high fees under proof of stake? Before it was to reward the miners. Who exactly is being rewarded high fees once it changes and for what purpose? If the costs to run a validator are too expensive or need too many resources then you just end up promoting a centralized solution.

The point of fees isn't primarily to reward the miners. That's what the block reward is for. Under PoS validators will still get a block reward, although a lower one (90% less). The fees are to mitigate spam attacks. You can only fit that many transactions in a block. Fees are bids to be included in a block. The higher the fee, the earlier your transaction gets included. Fees on Ethereum are high, because a lot of pe…

To add: in addition to fees being used to thwart spam, EIP-1559 introduced a mechanism where these fees (not the block reward of course) are burned. One way to think of it is almost like a "stock buyback" from the Ethereum network: by reducing the supply, your ETH is worth more.

Thus, between EIP-1559 (burns base fees) and The Merge's move to Proof of Stake (a dramatically reduced block reward), there's very little net-new ETH being introduced into the system.

Check out: https://ultrasound.money

Re: The Merge

#177

Post by Szpadel »

wmf wrote: post #167
bluquark wrote: post #90

This reminds me of the nerve-biting period up to the James Webb launch. The devs put off this transition for so many years trying to plan for every contingency, but we still can't be certain they didn't miss a crucial flaw. In a system where the only thing holding back malicious actors is technical constraints, it only takes one bug or one misaligned incentive for a vicious cycle to take down the entire Ethereum ecos…

there is no opportunity to realistically experiment with the change beforehand Yeah, it's a shame they couldn't test the merge three times on the Ropsten, Sepolia, and Goerli testnets.

if someone would find some critical flaw, wouldn't burn it on public testnet, but wait till it's possible to exploit with major profit on mainnet

Re: The Merge

#178

Post by DennisP »

p4bl0 wrote: post #70
fullsend wrote: post #51

Earlier quoted context omitted.

They already are. The Merge refers to the fact that the PoS chain has been running parallel to the main chain for one year now. It has been thoroughly tested live and so now will be merged back into the main chain like a branch of a git repo.

How can two chains be merged if one is a fork of the other without having instances of double spending? With source code in Git you can manually pick which version of each line you want in the merged result, but here it's not possible to do that if services or merch have been exchanged with coins. Except if you're fine with having to deal forever with coins and merged-from-the-fork coins on the eth blockchain?

Transactions and state are only on the PoW chain. The PoS chain only runs the staking protocol.

When the merge happens, the PoW software (the "execution client") will keep running transactions, but instead of choosing blocks by looking at miner hashes, it will look to the beacon chain to choose them. So stakers will run both the PoS client, and the execution client with the mining function turned off.

Re: The Merge

#179

Post by DennisP »

ben_jones wrote: post #115
X6S1x6Okd1st wrote: post #73

Earlier quoted context omitted.

> Who wants to set the over/under on $millions that get stolen? If you can think of a way to measure it metaculus would be interested properly. > Which exchange or fund will lose a vast chunk of its holdings? I'd place this at roughly at 0.01% chance for any major exchange or fund

> I'd place this at roughly at 0.01% chance for any major exchange or fund Over 0.01% of major exchanges and funds have been hacked or scammed this month .

Yeah but I doubt a major exchange or fund will get scammed by someone offering to upgrade their ETH tokens to ETH2.

Re: The Merge

#180

Post by hjorthjort »

rakoo wrote: post #56
WFHRenaissance wrote: post #30

Ethereum in its current state is using proof-of-work (PoW) to ensure consensus amongst the thousands of nodes in the network. While PoW is reliable and secure, it is also extremely energy intensive. To produce each block on the network participants are required to use powerful and energy-hungry GPUs to solve a complex mathematical problem. Alternatively, proof-of-stake (PoS) guarantees the security of the network in…

Thanks for the explanation! I have a few questions: - how does the punishment work ? Do all nodes see that a malicious actor changed the chain and write the bad ideas in some ledger meaning "these nodes just lost X ETH" ? - But if the malicious actor owns 2/3 of validators, what does he care what other nodes do ? They effectively control what block is accepted - is there an advantage to run more than one validator, i…

An important and often misunderstood point:

Having >2/3rds of validators (or >50% of power in PoW) let's you rewrite the chain back in history, censor txs, etc. You control what transactions go in blocks, and to a certain extent also recent history.

HOWEVER, this does not give you the power to steal or rewrite state as you please. You cannot convince the rest of the network that you now own someone else's ETH just because you have supermajority validator power. To take away ETH or change the cabin state in any other way, you need to include a valid and correctly signed transaction.

If you include an invalid state change (not caused by a successful and correct transaction) then all other nodes will reject that block, no matter how much validator power or hashing work went into it.

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