Ethereum Merger

The second-most valued cryptocurrency in the world, Ethereum, just underwent a substantial software upgrade.

About:

• Ethereum redesign: This process is referred to as "The Merge."
• It will do away with the requirement for cryptocurrency miners and massive mining farms, which previously powered the blockchain through a system known as "proof-of-work" (PoW).
• In its place, a "proof-of-stake" (PoS) mechanism has been adopted, which randomly selects "validators" to approve transactions in exchange for a modest payment.

How it has operated thus far:

• Since Ethereum is a decentralized cryptocurrency, its network does not have organizations like banks approving transactions.
• Before, the PoW consensus mechanism—which was primarily carried out by miners—was used for approvals.
• The first miner to complete a complicated mathematical puzzle would be chosen as the validator. Miners would compete to solve these riddles using a vast infrastructure of cutting-edge computer technology.
• Crypto farms, which are enormous warehouses filled with rows of computers that would solve the problems, were essentially the only source of power for this method.
• Problem: These energy-guzzler mining farms were a major environmental sustainability concern because they frequently consumed more electricity than entire nations. This was one of the main complaints of the cryptocurrency business.
• The "Merge" and the switch to the PoS consensus process are two recent changes.
• Although the new idea would eliminate the need for miners and mining farms, Ethereum would still be a decentralized platform.
• Instead, a validator will be chosen at random by an algorithm from a group of individuals who have "staked" (basically, pledged at least 32 Ethereum tokens on the network) their money.
• As a result, the Ethereum network would no longer require any miners.
• Cardano, Binance Coin, and Solana are among the cryptocurrencies that employ proof of stake.

Importance of the Merge

• Enhanced Security: It will significantly increase the security of transactions on the Ethereum network.
• Supporting Network: Since the Ethereum network serves as the foundation for some of the most well-known cryptocurrency applications, like non-fungible tokens (NFTs) and decentralised finance (DeFi), the redesign may have long-term repercussions.
• Reduced Energy Consumption: The switch to PoS will result in a nearly 99.95% reduction in the energy used by Ethereum.
• Ecologically Beneficial: Since it promises to reduce its carbon impact almost totally, it is also being viewed as an environmentally responsible action.
• Reduced Cost: It will assist in lowering the fee per transaction that miners and validators charge.
• More Returns: By taking part in this new validation procedure, it will also make it possible for regular people to profit from ethereum (staking).

Ethereum

• The second-most popular digital token after bitcoin is ether (ETH), the cryptocurrency of the Ethereum network (BTC).
• Everyone has unfettered access to digital currency and data-friendly services.
• Ethereum can be programmed, which makes it ideal for many various types of digital assets, including Bitcoin.

Bitcoin

• Satoshi Nakamoto, an unidentified hacker or hacker collective, created Bitcoin in 2009.
• A "peer-to-peer electronic cash system" was used to describe it.
• Due to the lack of servers and centralized power, the system was entirely decentralized.
• The first cryptocurrency to gain widespread acceptance as Bitcoin. Later, more cryptocurrencies such as Litecoin, Namecoin, and PPcoin emerged.
• In many ways, ether and bitcoin are comparable.
• Both of them are digital currencies that can be bought and sold on online exchanges and kept in different kinds of cryptocurrency wallets.
• Both of these tokens are decentralized, which means that no central bank or other institution issues or controls them.
• Both make use of the blockchain, a distributed ledger technology.

Digital currency

• It is a form of digital money that can be used in place of real money.
• Cryptography is employed in cryptocurrencies to safeguard and verify transactions. Controlling the supply of cryptocurrency is another purpose for it.

Cryptocurrency characteristics:

• Irreversible: A cryptocurrency transaction is irreversible and cannot be undone.
• Intangible: There is no physical asset or guarantee backing cryptocurrencies.
• Instantaneous and global: Because the network is global, the transaction can be completed instantly and without boundaries anywhere in the world.
• Secure: It makes use of cryptography, which is nearly impossible to crack.
• No central authority: Users are solely accountable for all transactions; there is no gatekeeper like there would be in a government or central bank.

International Day of Peace 2022

• On September 21, people all over the world mark International Day of Peace.
• 2022's theme is "End Racism." Create peace.

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What is the International Day of Peace's main highlights?

• The UN General Assembly has designated this day as one committed to advancing the values of peace through the observance of a 24-hour period of nonviolence and a cease-fire.
• Background: The United Nations General Assembly established the International Day of Peace in 1981.
• The General Assembly voted overwhelmingly in 2001 to declare the Day to be a time of nonviolence and a cease-fire.

International Peace Day's emblem:

The Peace Bell was given as a gift by the Japan-United Nations Association in 1954. On the first day of spring, at the Vernal Equinox, and on September 21st, International Day of Peace, the bell is traditionally rung twice a year.

Day of Peace and Non-Violence

• On October 2, which is Mahatma Gandhi's birthday, people around the world mark the International Day of Nonviolence.
• To "disseminate the message of non-violence, particularly via education and public awareness," the UNGA founded it in 2007.

What are the Different Obstacles to World Peace?

• Racism on the rise Black Americans make 25% less money than white Americans do.
• Black Americans are twice as likely as white Americans to be unemployed.
• At comparable levels of income and education, black women are three to four times more likely than white women to die during pregnancy.
• Global Unrest: According to the World Population Review, militarised attacks and battles resulted in at least 1,000 deaths (mostly civilians) in each of 8 countries in 2019, including Afghanistan, Yemen, Syria, Turkey, Somalia, Iraq, Mexico, and Libya.
• Russia-Ukraine Conflict: The conflict in Ukraine has caused a crisis in the cost of living. A total of 1.6 billion people are thought to be affected by the crisis's food, energy, and financial aspects.
• Refugee Crisis: According to the UN Refugee Agency, at the end of 2019, there were 79.5 million refugees worldwide because of war, persecution, and other factors.
• Global Powers' Role: As permanent members of the UN Security Council, the United States, Russia, and China are obligated to safeguard world peace and harmony. Instead, it has been discovered that they encourage instability in order to seize geopolitical control. Examples: The indiscriminate attacks by the U.S.-backed coalition of Saudi Arabia and the UAE, whose geopolitical purpose is to counterbalance Iran, are to blame for the tragedy in Yemen, which the UN has deemed the world's worst humanitarian crisis.
• Due to the active engagement of mercenaries and weapons pushed in by Russia and the Gulf Arab monarchies that are allies of the United States in an effort to counter Turkey's influence, Libya has descended into chaos.
• The likelihood of armed conflicts in Asia has considerably increased as a result of China's hegemonic expansionism against its neighbours and its 'new Cold War' with the United States.
• New Power Tussle: Conflict and rivalry between major nations, such as the USA and China A second Cold War is roiling, endangering world peace.
• Pandemic and Climate Crisis: The increase in extreme weather events around the world and the spread of pandemics like COVID-19 have raised a new concern that may have an impact on both the direct and indirect stability of the world's economies, public health, and education systems, as well as the displacement of people.

Way ahead

• On the International Day of Peace, it is important to identify and oppose the unjust system that gives great powers preferential treatment and allows them to carry out their horrifying schemes. The struggle for a fair international order should be prioritised by intellectuals, social movements, and responsible states.

Hedge Fund

• A hedge fund is a limited partnership of private investors whose capital is managed by experienced fund managers. These managers employ a variety of tactics, such as borrowing money or trading in non-traditional assets, to generate returns on investments that are higher than average.
• Investment in hedge funds is frequently viewed as a dangerous alternative investment option since it typically has a high minimum investment requirement or net worth requirement and frequently targets wealthy clientele.

Regulatory specifications

There is no requirement for hedge funds in India except register with the Securities and Exchange Board of India.

Several types of hedge funds in the market:

• Domestic hedge funds: Only investors who must pay taxes to the nation of origin may invest in domestic hedge funds.
• Hedge funds that operate outside of their home country—ideally in one with low taxes—are known as offshore funds.
• Mutual funds that invest in other hedge mutual funds rather than the specific underlying equities are known as "funds of funds."

Hedge Funds v/s Mutual Funds

• Hedge funds are distinct from mutual funds, and they are not subject to the Securities and Exchange Commission's (SEC) the same level of tight regulation.
• Mutual funds, which are accessible to the general public and average investor, are a practical and cost-effective solution to create a diversified portfolio of stocks, bonds, or short-term investments.
• Only accredited investors—those with an annual income above $200,000 or a net worth surpassing $1 million, minus their primary residence—can contribute money to hedge funds.
• While mutual funds utilize stocks or bonds as their instruments for long-term investment plans, hedge funds can invest in real estate, stocks, derivatives, and currencies.