Digital asset firm Gemini notes that the most consequential Ethereum network upgrade yet, called “The Merge,” is planned for mid-September this year.
The upgrade will “codify Ethereum’s long-awaited move to Proof-of-Stake (PoS) from its existing Proof-of-Work (PoW) consensus mechanism.”
Following years of planning, and numerous test merges, Ethereum is “on track to merge its existing execution layer (Mainnet) with the Beacon Chain, its parallel PoS system.”
Gemini also mentioned that the Merge is “expected to make Ethereum more scalable, secure, and sustainable, with a projected 99.95% reduction in energy consumption.”
According to Gemini, there are three main points to keep in mind:
- Gemini will support Ethereum’s PoS chain — Following the Merge, we will support the Ethereum PoS chain. We expect all Ethereum (ETH) and ERC-20 assets held at Gemini to be available on the PoS chain following the Merge.
- No action is needed to upgrade — As a Gemini user, you do not need to take any action in order to shift your assets to the new PoS chain.
- All funds held at Gemini will remain secure throughout the Merge — The Gemini team is actively planning for Merge-related disruptions to our operations, which are normal and expected when blockchains undergo significant updates. While there may be some short-term impacts to Gemini’s operations, all Gemini funds will remain secure throughout the Merge.
Anticipated Impact on Gemini Operations
Around the time of the Merge, there is potential “for some short-term disruptions as validators, developers, applications, and users move over to the PoS Beacon chain.” Gemini expects some systems to be “impacted by these disruptions,” including:
- Deposits and Withdrawals — We are expecting to pause Ethereum (ETH) and ERC-20 deposits and withdrawals for a short period of time before and after the Merge as we assess network stability.
- Wallet Balances — To ensure parity between ETH and ERC-20 assets held on Gemini prior to and after the Merge, we will take a snapshot of all balances before the Merge and make sure that assets are correctly reflected post-Merge.
- Gemini dollar (GUSD) — Following the Merge, GUSD assets will be shifted to Ethereum’s PoS chain, after which they will be redeemable.
- All Gemini trading systems will “remain active throughout the Merge.”
At Gemini, they believe this milestone for the Ethereum ecosystem “will drive increased adoption, security, and sustainability of blockchain networks.”
As we get closer to the Merge, Gemini will continue “to communicate short-term changes to our systems as we prepare for the transition to Ethereum’s PoS blockchain.” You may refer back to this post for additional updates as more information becomes available.