Bye-Bye, Miners! How Ethereum’s Big Change Will Work

The idea behind the proof of stake system being adopted by Ethereum is that its blockchain can be secured more simply if you give a group of people a set of carrot-and-stick incentives to collaborate. People who put up, or stake, 32 Ether (1 Ether traded at almost $4,300 in late November) will be able to become “validators,” while those with less Ether can become validators jointly. Validators are chosen to order transactions into a new block on the Ethereum blockchain. If a block is accepted by a committee whose members are called attestors, its validator is awarded Ether. But someone who tried to game the system could lose the coins that were staked. Ethereum’s proof of stake system is already being tested on a blockchain, called the Beacon Chain, that’s separate from the proof of work system; so far $38 billion worth of Ether has been staked there. The two blockchains are expected to merge in 2022.