Ethereum 2.0 to resolve contemporary issues on-chain
The team behind Ethereum is upgrading to Ethereum 2.0 (Eth2 or Serenity) to make the blockchain network more scalable, secure, and sustainable. By avoiding congestion in its production system (bottlenecks), Ethereum can process more transactions simultaneously.
By safeguarding its current core ethos of decentralization and addressing the contemporary issues on-chain, the blockchain plans on growing “until it’s powerful enough to help all of humanity.”
CURRENT BLOCKCHAIN ISSUES
Despite popularity rarely being an issue, in this unusual instance, it is. As the desire for Web3 and NFTs skyrockets, so have gas prices, resulting in gas wars, bottlenecks and a bear market. Therefore, the supply for cryptocurrency is more significant than demand, confidence is low, and prices are on a downtrend.
Following this, running a node (a cryptocurrency component) on Ethereum is becoming problematic. In short, the blockchain uses too much energy to resume functioning efficiently. If the network continues to scale, the issues will only become more challenging.
COMBATING INDUSTRY ISSUES
Aware of the logistics behind contemporary problems on the blockchain, Ethereum is rolling out new technology to make its blockchain scalable, secure and sustainable. The network plans on reducing congestion and improving speeds to offer better services to users around the globe. Many critics believe centralization would be beneficent. However, decentralization is what makes Ethereum secure and appealing to users.
Ensuring the blockchain continues to be decentralized comes with many hurdles. Although an increase in the nodes’ size and power has the potential to increase transactions securely, the hardware necessary restricts which validators can make changes. Only users lucky enough to have robust, state-of-the-art computing systems can alter the network.
So, how can the team behind Ethereum ensure scalability, security, and suitability is at the forefront of its mission while allowing all users to validate the blockchain’s network?
Ethereum’s team believes Shard Chains can assist in the growth of Ethereum with few problematic consequences. By implementing shards, the blockchain can expand without congestion by splitting Ethereum’s network into smaller portions (shards). As a result, the process can maximize transactions per second while minimizing the power necessary to validate and run a node on-chain. Additionally, it has the potential to reduce bottlenecks while becoming more extensive and decentralized.
The blockchain plans to use sharding to split the network into 64 new chains next month. Therefore, Ethereum estimates its transaction speeds to improve beyond its current 15-45 transactions per second limit, eventually reaching 100,000 transactions per second.
Ensuring Ethereum 2.0 is secure, the upgrade will eliminate the blockchain’s current consensus mechanism, Proof-of-Work (POW), and implement Beacon Chain‘s Proof-of-Stake (POS) instead. For staking, users must deposit 32 ETH to activate validator software. Consequently, users become responsible for processing transactions, storing data, and adding new blocks to the blockchain. Other benefits of POS include:
- Using less energy
- Reducing hardware requirements
- Providing less risk of centralization over using more nodes
- Social recovery for attacks
Therefore, staking is a commitment process beneficial for Ethereum’s ecosystem in many ways. In the meantime, users can reap ETH-related rewards.
Stakers can participate in a POS system at home, using a computer or smartphone rather than needing the energy-intensive computers that are currently necessary. As a result, POS has the capabilities to dramatically resolve environmental issues concerning blockchain energy without illuminating decentralization and security.
To better understand the power of POS, it’s vital to dig into Ethereum’s current mining process, which has used POW mechanisms for the last eight years. Miners validate transactions by creating a block of transactions before adding them to the blockchain. The blocks then get transmitted to other node operators for verification. Finally, providing the node is trustworthy and the miner completes a computational puzzle faster than all other miners, the block gets placed on the Ethereum network.
Despite POW appearing to be a secure and robust way for Ethereum to make sincere changes to the blockchain, it accompanies many problems. The main issue is that miners can increase their chances of success by buying powerful hardware and power-hungry equipment. Thus, mining takes up a lot of energy and badly affects our carbon footprint.
Leaving POW for POS has been Ethereum’s objective not long after launching in 2014. However, breaking the mechanisms necessary for the transition took longer than anticipated. Under POS, there’s no need for arbitrary puzzle-solving—this alone significantly reduces the energy expenditure needed to secure the network. Instead, Ethereum will have validators who perform the same functions as miners but stake ETH as collateral against corrupt behavior—rather than using the POW initiative to take away the power essential for a successful mine.
THE LAUNCH OF ETHEREUM 2.0
Since December, Beacon Chain has worked hard to ensure its POS chain supplies Ethereum with a viable POS protocol. As a result, Ethereum users boast about the ongoing upgrade becoming the most impressive improvement to the blockchain. However, despite plans to transition next month, problems arise over bugs found in Ethereum that delay booting miners off-chain.
Hopefully, this is the last time Ethereum faces delays and we will soon notice the promised changes.
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