What is "The Merge" and what changed for Ethereum?

For its first seven years, Ethereum used the same energy-intensive Proof of Work mechanism as Bitcoin, requiring miners with expensive hardware to validate transactions. In September 2022, Ethereum completed a transition to Proof of Stake - an entirely different validation model where participants lock up ETH as collateral to earn the right to process transactions. This event was called The Merge because the original Ethereum chain merged with a new Proof of Stake chain that had been running in parallel. The overnight impact was a reduction in Ethereum's energy consumption by roughly 99.95% - one of the most significant environmental achievements in technology history. It also made ETH holders eligible to stake their coins and earn protocol rewards.