How Ethereum 2.0 will help the crypto community
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Ethereum 2.0 is the next version of Ethereum blockchain technology to enrich the current blockchain with a new function. Ethereum 2.0 comes with many solutions related to the current cryptoverse.
Ethereum was developed to provide a platform that can facilitate immutable and programmatic contracts and applications through its own currency. However, it had some limitations such as slow transaction processing and high transaction costs.
To provide more enjoyable decentralized platforms, as well as to handle the multiplication of transactions, Ethereum developers have updated the blockchain with new features and solutions. Ethereum 2.0 is a crucial development in the crypto space for users.
What makes Ethereum 2.0 different from Ethereum
Ethereum 2.0 should overcome the current limitations, which is a big burden for users and developers. The update will increase network speed, efficiency, and scalability with better security.
Below are the three crucial features that are going to be added in the update.
- Proof of Stake
Proof of Stake
Ethereum 2.0 will replace the proof-of-work mechanism with proof-of-stake for validators. This feature solves power issues because the PoW mechanism requires a large amount of power to calculate complex equations for Ethereum mining.
Proof of Stake is an alternative and energy-efficient option for the blockchain developer, where validators confirmed the authenticity of transactions instead of miners.
Ethereum 2.0 developers believe that PoS will only use 0.05% of Ethereum’s total energy. In this way, they plan to make Ethereum a more carbon-efficient blockchain.
Sharding provides scalability to the blockchain network by dividing it into different areas or shards to execute multiple transactions simultaneously. This will allow Ethereum to manage transaction congestion.
Currently, the Bitcoin blockchain executes seven transactions per second, while Ethereum is able to handle 15-45 transactions on its network. These low numbers can stifle the growth of Ethereum and Bitcoin.
With sharding, Ethereum technology will be able to execute transactions in less time. It should exceed the transaction speed of Solana, which is considered an ETH killer due to its high speed.
Ethereum Virtual Machine (EVM)the crucial development that shifted the focus of DeFi users from Bitcoin to Ethereum. Basically, EVM is the network trained on all nodes with smart contract capability. One can create games, execute financial transactions or provide online services.
EVM codes are a complex matrix of codes, and for this reason it is difficult for many skilled programmers to modify the code. As a solution, the developers planned to add a new web assembly language, eWASM.
eWASM will allow Ethereum application codes to run in currency web browsers. Even programmers will be able to choose from different programming languages like Rust, C, and C++ to write code.
Ethereum 2.0 development phases
Currently, Etheruem executes day-to-day transactions and projects are running on Ethereum. So, instead of deleting Ethereum, the developers decided to update the blockchain in three phases to integrate it with the Ethereum mainnet.
- This phase contains the launch of the beacon chain (helps Ethereum 2.0 to expand the network by connecting multiple nodes).
- This phase was rolled out in December 2020.
- The first phase will merge the beacon chain with the Ethereum mainnet, which will enable staking on the network.
- This phase was supposed to be launched in 2021, but due to technical delays, it is now planned for 2022.
- The latest phase of Ethereum 2.0 will add a shard chain. Adding this chain will provide multiple transaction capability.
- It is estimated that the shard chain will integrate with Ethereum 2.0 by 2023.
As Ethereum 2.0 is packed with fascinating features and capabilities, it will definitely bring scalability and flexibility to the network. The PoS mechanism solves power issues, which may attract the attention of crypto entrepreneurs. It will not be surprising if the market value of ETH shows a rise after the full launch of Ethereum 2.0. Additionally, lower transaction fees and costs, along with increased security, will build trust in crypto innovators and developers. Ethereum 2.0 is definitely set to bring revolutionary changes in blockchain technology.
Rajpasinh Parmar is a technical content writer at The Crypto Times and is passionate about blockchain and the metaverse.
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