In 2022, Ethereum switched consensus model. How proof of stake works, and what the switch meant for energy use and security.
Ethereum originally used proof of work, the same model as Bitcoin. Miners competed with computing power to add new blocks.
The model was secure, but used a lot of electricity and was hard to scale. The plan to switch models was there from the start.
In proof of stake, the network is secured by validators who lock up ether as collateral. They are selected to propose and confirm new blocks, and earn ether as a reward.
If a validator breaks the rules, part of the stake can be taken away. That gives economic reasons to behave honestly.
In September 2022, Ethereum made the switch, known as The Merge. The network changed its consensus model without stopping, after years of testing.
Energy use fell by more than 99 percent overnight. The upgrade also laid the groundwork for later scaling improvements.
Anyone who owns ether can take part in securing the network, either directly or through a service. This is called staking and provides an ongoing return in ether.
Staking has become an important part of the Ethereum economy. At the same time, there is debate about large staking services concentrating a lot of power.