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"ETH2.0" Everything u need to know about it

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Written by   83
1 year ago

A few days back I wrote an article called Ethereum "King of Altcoins" u can visit it here. Most people commented about what is Ethereum 2.0 why it is so important and what happens to the existing Ethereum. I will try to clarify most of your quires here.

What is Ethereum?

According to Ethereum.org, Ethereum is open access to digital money and data-friendly services for everyone – no matter your background or location. It's a community-built technology behind the cryptocurrency ether (ETH) and thousands of applications you can use today.

  • Ethereum is the second largest cryptocurrency by market share next to only bitcoin.

  • Most of all defi projects runs on Ethereum.

  • 25% off all tokens are based on Ethereum.

So why upgrade this much big network? and why it is important to Ethereum and to the whole crypto world? This is also the first and massive and big transition ever took place on cryptos.

Lets start with the drawback of Ethereum 1.0 first,.

Drawbacks of Ethereum 1.0

  • The current network even with all of its latest upgrade is still slow, it can only support 30 transactions per second if Ethereum needs to be a currency it wont be enough.

  • It consist of only single blockchain which makes it secure but very slow and inefficient in long term

  • And finally u all know very high gas fees.

How Ethereum 2.0 tries to solve this problem

  • One of the main reason to upgrade to Ethereum 2.0 is scalability. While Eth 1.0 supports only 30 transactions per second eth2.0 supports up to 100,000 transactions per second

  • The faster transaction will greatly reduce the gas fees

  • Ethereum2.0 unlike Ethereum 1.0 has 4 blockchains running parallel to each other which makes it secure and also increases its speed and effeiceincy.

Now that we know the drawbacks and how Ethereum tries to solve this problem. Lets see What is ethereum2.0 and How it differs from ethereum1.0.

What is Ethereum 2.0

Ethereum 2.0, also known as Eth2 or “Serenity”, is an upgrade to the Ethereum blockchain. The upgrade aims to enhance the speed, efficiency, and scalability of the Ethereum network so that it can process more transactions and ease bottlenecks.

How does Ethereum 2.0 differ from Ethereum1.0?

While Ethereum 1.0 uses a consensus mechanism known as proof of work (PoW), Ethereum 2.0 will use a proof of stake (PoS) mechanism. We will see what is the difference between the two in brief in later articles, Now I will just give u the brief Introduction about the two.

Proof of Work vs Proof of Stake

Proof of Work

In a decentralized blockchain such as Ethereum, to make the blockchain secure and to prevent no single entity to be the owner Ethereum like other cryptocurrencies need to verify the transaction for that it uses a consensus mechanism known as proof of work (PoW).

In this system, miners use computer hardware processing power to solve complex mathematical puzzles and verify new transactions. The first miner to solve a puzzle adds a new transaction to the record of all transactions that make up the blockchain. They are then rewarded with cryptocoins. However, this process can be energy-intensive.

Proof Of Stake

Proof of stake (PoS) differs in that instead of miners, transaction validators stake crypto for the right to verify a transaction. These validators are selected to propose a block based on how much crypto they hold, and how long they’ve held it for.

Other validators can then attest that they have seen a block. When there are enough attestations, a block can be added to the blockchain. Validators then are rewarded for the successful block proposition. This process is known as “forging” or “minting”.

The main advantage of PoS is that it is far more energy-efficient than PoW, as it decouples energy-intensive computer processing from the consensus algorithm. It also means that you don’t need a lot of computing power to secure the blockchain.

Now that we know the main difference between the two, how the ethereum2.0 is going to take place?

Ethereum2.0 upgrade timeline

Following a series of testnet launches, Topaz, Medalla, Spadina and Zinken, the full roll-out of Ethereum 2.0 will take place in three phases: Phase 0, 1, and 2 (developers like to count from zero). Phase 0 is aiming for a 2020 launch date, with the other phases coming in the following years.

Phase 0

It sees the implementation of the Beacon Chain; this stores and manages the registry of validators as well as deploying the proof of stake (PoS) consensus mechanism for Ethereum 2.0. The original Ethereum PoW chain will run alongside this so there is no break in data continuity.

Phase 1

Phase 1, due in 2021, will see the integration of proof of stake shard chains. The network is expected to launch with 64 shards (enabling 64 times more throughput than Ethereum 1.0) though at launch they won't support accounts or smart contracts.

Phase 1.5

Phase 1.5, an interim update due in 2021, will see the Ethereum mainnet officially becoming a shard and transitioning to proof of stake.

Phase 2

Phase 2, slotted to launch in 2021/22, will see shards becoming fully-functional and compatible with smart contracts. It also involves adding Ether accounts and enabling transfers and withdrawals, implementing cross-shard transfers, and contract calls. It will build execution environments for scalable apps that are built on top of Ethereum 2.0.

When Will Ethereum 2.0 Be Released?

Ethereum 2.0 is set to launch on December 1, according to a blog post from the Ethereum Foundation. The launch is conditional on certain criteria being met, though; there need to be 16,384 validators on the network by November 24, each staking 32 ETH, for a total of 524,288 ETH. If u wish to stake 32 eth u can see the steps on how to stake and its total information here.

How could Ethereum 2.0 affect Ethereum’s price?

“Once Ethereum has scalability via layer-2 tech or ETH 2.0 all questions are answered,” Jamie Anson, founder of Nifty Orchard and organizer of Ethereum London, told Decrypt. “The firing gun will go off.”

In other words, more scalability means more usage, which, in turn, means more demand. Which—at least in theory—should propel the price of Ethereum to new heights. “By the time ETH 2.0 and rollups work together there will be 100,000 transactions per second capacity. That’ll mean a completely seamless experience for the next billion people,” Anson added.

So what do regular investors and traders like u and I should do?

Just simply do what do u do usually. U see the eth 2.0 is not yet launched and even if it launched there wont be any hassle for us to worry about. The transition will be seamless and most people would not notice a thing. Don't fear what are u gonna do with eth 1.0 coins when eth 2.0 is launched, all your existing eth 1.0 coins will be automatically converted into eth 2.0 once it launched successfully. So I simply say buy, trade and Hodl eth as u always do, no need to fear anything.

Just all on todays article about eth2.0 if u have any queries comment down below and I would be happy to answer them. If u like the post kindly share it with others as others can also learn about eth2.0.

Well this is for now, will see u back later.

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Comments

After going through your posy about ethereum 2.0.I think its a great posy but am not satisfy because my questions and answers hasn't been answered yet on erc20. I am not sure how ethereum 2.0 is handling gas fees which is the monster in ethereum contracts.

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11 months ago

What are your que? and the gas fees will be known only after the eth2.0 successfully launched

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11 months ago

A very good article on this rather extensive topic. Very easy to read and of course to understand... Personally, I prefer ETH 2.0 even before BTC, but for that to happen, everything must be finished and work. We will see where the journey goes in the next years. But thanks again for the contribution.

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1 year ago