Why Did Ethereum Switch From Proof of Work to Proof of Stake?
Direct answer
The Merge in brief
Ethereum switched to proof of stake to secure the network with staked ETH instead of energy-hungry mining, as part of a long-planned roadmap toward more scalability, security and sustainability. The switch, called The Merge, happened on September 15, 2022, when the original chain joined the Beacon Chain that had run in parallel since December 1, 2020. ethereum.org says it cut the network's energy use by about 99.95% and reduced new ETH issuance by about 88%, from roughly 13,000 ETH a day paid to miners to about 1,700 ETH a day paid to stakers. It did not make ETH outperform: on Coinbase prices ETH has fallen about 62% against BTC since the Merge.
- Date: September 15, 2022 (ethereum.org)
- Energy use: about −99.95%
- New issuance: about −88% (13,000 → ~1,700 ETH/day)
- Validators stake 32 ETH
- misbehaviour can be slashed
- ETH/BTC since the Merge: 0.0748 → 0.0283 (−62%)
Ethereum ran on mining, like Bitcoin, for seven years. In September 2022 it switched off mining overnight. The reasons were mostly engineering and economics, and the results are measurable.
What people on X are asking
In October 2026 an explainer recapped that in September 2022 Ethereum made "a historic change known as The Merge, switching off its original Proof of Work", and asked: but why? A May 2026 post said "The official answer was energy and scaling", citing the 99.95% energy cut, but called that "the cover story". A March 2026 post argued ETH was "down 65% vs. BTC since pivot". We check the official record and the price data.
What people in the thread said
- @preciousprime07 noted the Merge changed Ethereum's security model and sharply cut energy use. That fits the 99.95% figure above.
- @bumzzylamar1 asked whether ETH's price would have done better under proof of work; the original poster @BRICK_H_Q replied that adoption, demand and liquidity matter as much as the consensus method. Nobody can test that counterfactual.
These are community comments, summarised in our words; the data and sources below come first.
The fact-checked answer
What the Merge was. According to ethereum.org, the Beacon Chain launched on December 1, 2020 as a separate proof-of-stake chain running in parallel to Mainnet. On September 15, 2022 the two were joined: Mainnet's execution layer (accounts, balances, smart contracts) kept running, but block production moved from miners to validators. ethereum.org says this "eliminated the need for energy-intensive mining and instead enabled the network to be secured using staked ETH", as a step toward "more scalability, security, and sustainability".
Proof of work vs proof of stake on Ethereum
Figures from ethereum.org's Merge, issuance, energy and proof-of-stake pages. Staking issuance changes with the total amount staked; the burn of transaction fees is separate and varies with network use. Tap a column header to sort.
| Who adds blocks | Miners with specialised hardware | Validators who deposit 32 ETH |
| What secures the chain | Electricity and hardware spent | ETH at stake that can be destroyed (slashed) |
| Energy use | Baseline | About 99.95% lower (ethereum.org) |
| New ETH issued | About 13,000 ETH/day to miners | About 1,700 ETH/day to stakers (with ~14M ETH staked) |
| Change in issuance | – | About −88% |
| Cost to attack finality | Majority of hash power | At least one-third of all staked ETH destroyed |
Reason 1: security without energy. Under proof of work, attacking the chain means out-spending honest miners on hardware and power. Under proof of stake, validators lock ETH, and ethereum.org explains that breaking a finalised block would require an attacker to lose at least one third of all staked ETH. The cost of security moves from electricity to capital at risk.
Reason 2: energy. ethereum.org puts the cut at about 99.95%, and its energy page cites the Crypto Carbon Ratings Institute's estimate of more than 99.988% lower annual electricity use. Whatever one thinks of the motives, the reduction is the best-documented outcome.
Reason 3: lower issuance. Paying miners for electricity required high issuance. Since the Merge, execution-layer issuance is zero and only the staking reward remains, which ethereum.org estimates cut new ETH issuance by about 88%. Whether total supply then falls depends on the fee burn: when network activity is low, burn is small and supply can grow, so "ultrasound money" was never guaranteed.
Reason 4: the roadmap. Ethereum's developers had planned the move for years; ethereum.org describes the Beacon Chain and the Merge as stages before further upgrades for scaling.
Did it help the price? Not relative to Bitcoin. On Coinbase daily prices, ETH was worth 0.0748 BTC on Merge day and 0.0283 BTC on November 9, 2026: a fall of about 62%, a little less than the 65% in the post above. In dollars ETH rose from $1,473 to $2,128, while BTC went from $19,691 to $75,091. A consensus change is not a price driver on its own.
UXS chart
ETH priced in BTC since the Merge
ETH/BTC (Coinbase): latest
0.03
November 9, 2026
Highest in chart period
0.09
December 8, 2021
Lowest in chart period
0.02
April 20, 2025
Change over 1 year
-0.01 pts
vs November 9, 2025
Year by year: ETH/BTC (Coinbase)
Computed by UXS from the same data as the chart. Tap a column header to sort. * = year to date (latest data November 9, 2026).
| 2026* | 0.03 | -0.01 pts | 0.04 | 0.03 |
| 2025 | 0.03 | -0.00 pts | 0.04 | 0.02 |
| 2024 | 0.04 | -0.02 pts | 0.06 | 0.03 |
| 2023 | 0.05 | -0.02 pts | 0.08 | 0.05 |
| 2022 | 0.07 | -0.01 pts | 0.08 | 0.05 |
| 2021 | 0.08 | – | 0.09 | 0.02 |
UXS decision diagram
Does proof of stake change how I hold ETH?
Text version of the diagram
- Do you just hold ETH in a wallet or on an exchange? If no: Staking: validators deposit 32 ETH, or use a pool; slashing and lock-up risks apply
- Do you want the staking reward? If no: Nothing changes for you; the Merge did not change balances or addresses
- Are you able to stake 32 ETH and run validator software? If no: Pooled or exchange staking: compare fees, custody and withdrawal terms
- Otherwise: Solo staking: you earn rewards and bear slashing and uptime risk
Diagram drawn by UXS. A simplified decision aid for education, not a recommendation.
Decision helper
| Claim you see | What the record shows |
|---|---|
| "PoS made ETH deflationary" | Issuance fell ~88%; supply depends on the fee burn |
| "The Merge cut energy 99.95%" | Correct per ethereum.org |
| "The Merge made ETH go up" | ETH fell ~62% against BTC since |
| "Staking is free yield" | Rewards come with slashing, custody and lock-up risk |
For how stakers earn, see how Ethereum staking works; for the basics, what Ethereum is and how it differs from Bitcoin; and for the ratio's drivers, what moves Ethereum against Bitcoin.
Common mistakes
- Thinking the Merge reduced fees; it changed consensus, not capacity.
- Treating lower issuance as a guarantee of falling supply.
- Ignoring slashing and custody risk when staking.
FAQ
When did Ethereum switch to proof of stake?
On September 15, 2022, in the upgrade called The Merge.
Why did Ethereum move to proof of stake?
To secure the network with staked ETH instead of mining, cutting energy use and issuance as part of its roadmap.
How much energy did the Merge save?
About 99.95%, according to ethereum.org.
Did the Merge change ETH supply?
It cut new issuance by about 88%; net supply also depends on how much ETH is burned in fees.
How much ETH do you need to be a validator?
32 ETH; pools let smaller holders stake.
How has ETH done against BTC since the Merge?
It has fallen about 62%, from 0.0748 to 0.0283 BTC (Coinbase, to November 9, 2026).
Sources
- ethereum.org: The Merge
- ethereum.org: How The Merge impacted ETH supply
- ethereum.org: Energy consumption
- ethereum.org: Proof-of-stake
- FRED: Coinbase Ethereum (CBETHUSD)
Facts checked November 10, 2026. X posts are cited as evidence of the question, not of the answer.