Bye-Bye, Miners! How Ethereum’s Big Change Will Work
Ethereum is making big changes. Perhaps the most important is the jettisoning of the “miners” who track and validate transactions on the the world’s most-used blockchain network. Miners are the heart of a system known as proof of work. It was pioneered by Bitcoin and adopted by Ethereum, and has come under increasing criticism for its environmental impact: Bitcoin miners now use as much electricity as some small nations.
Along with being greener and faster, proponents say the switch, now planned to be phased in by early 2022, will illustrate another difference between Ethereum and Bitcoin: A willingness to change, and to see the network as a product of community as much as code.
Cryptocurrencies wouldn’t work without a new type of technology called blockchain that performs an old-fashioned function: maintaining a ledger of time-ordered transactions. What’s different from pen-and-paper records is that the ledger is shared on computers all around the world and operated not by a central authority, like a government or a bank, but by anyone who wants to take part.
Satoshi Nakamoto is the mysterious and still-unknown creator of Bitcoin and its blockchain. What Nakamoto accomplished through the proof of work system was solving the so-called double-spend problem that plagued earlier digital cash projects: Because the blockchain records every single transaction on its network, someone trying to reuse a Bitcoin that has already been spent would be easily caught.