Ethereum 2.0 is a term used to explain a series of updates to Ethereum to make it hasty and better. The launch of Ethereum 2.0 is very significant when it is compared to past upgrades due to the implementation of the Proof of Stake (PoS) consensus mechanism that successfully moves the network from the existing Proof of Work (PoW) architecture. It is important to note here that PoS is the most critical change in Ethereum 2.0 as it brings in reform in the crypto-economic incentive structure for verifying the Blockchain. The PoW consensus mechanism helps to maintain the current architecture of Ethereum. The PoW components are familiar to the blockchain community as it is the same architecture used for popular blockchains today, like Bitcoin and Ethereum.
Ethereum 2.0 Solutions
Ethereum is working on several solutions to upgrade the network. Here is a brief overview of the various solutions that it plans to implement:
- PoS solutions like Casper and Beacon point out a switch in the method by which Ethereum is mined. It looks into how new coins are created and how the system is secured.
- Sharding is another solution that refers to splitting up an extensive database into smaller parts that are manageable. This will address the scalability and speed of transactions and stop an app from slowing down the entire network.
- eWASM allows faster execution of code among all other things. It will help to expand the coding options and even increase the capability of the Ethereum Virtual Machine.
- Plasma refers to an extra layer that sits on top of the network, handling large amounts of transactions. In a nutshell, it is an able reply to the much talked about Lightning Network of Bitcoin.
- Raiden, like Plasma, is an off-chain scaling solution.
What Are the Major Tech Changes in Ethereum 2.0?
The performance of the early blockchain implementations was abysmal. It tended to rely on the Proof-of-Work (dependant on processing power) process for validating and recording transactions. However, the very design of this process made it inefficient. One of the major changes that one will encounter is Ethereum 2.0 is the transition of the Blockchain to a more efficient PoS or Proof-of-Stake system. In this system, the node that records transactions is chosen by an algorithm. The chances of selection increase with the amount of currency held by the node owner. Since each of the nodes will stake its currency for participation, it will become costly for anyone to attack this network.
Ethereum 1.0 Problems1
When compared to modern-day web architecture, Ethereum 1.0 stands nowhere, as per the Ethereum news. It was a monolithic blockchain (unscalable system) that tried to compete with the modern web, a highly scalable system. The situation was so untenable that a complete re-architecture was needed. The wealth transfer on Ethereum 1.0 created a transaction fee that, unfortunately, downed all the applications that suffered from a low economic value (most dApps). The dApps that survived were less successful.
Additional Goals of Ethereum 2.0
The main goal of Ethereum 2.0 is to simplify the Ethereum blockchain and keep the network live during the major network splits. There are some additional goals of Ethereum 2.0 such as –
- Reduction in the barriers to entry, thereby making it PoSsible for a typical laptop validate shards.
- Increase the security through design techniques that will allow a large number of validators to secure the network.
- Ensure the longevity by building Ethereum 2.0 with those elements that are fully quantum secure. Therefore if you want to read more about the same, you just tap here.
Ethereum 2.0 will show to the world that it can easily compete with the new networks and the upgraded coins, some of which are faster than Ethereum. It is heartening to note that every aspect of Ethereum 2.0 has a solution to every problem that Ethereum 1.0 had, and it gives us solace in knowing that Ethereum 2.0, 3.0, and so on will be possible soon. It means that with the evolution in technology, Ethereum will evolve too, and there can be no better news than this. As we all know that Ethereum is at the top of all altcoins and will surely perform well in the market.