Ethereum 2.0? What can we expect?

Ethereum’s new upgrade has been everywhere in the crypto world. Therefore, it is okay fr anyone to be curious.

Most people are probably familiar with Ethereum.

Ethereum is a decentralized, open-source blockchain with smart contract functionality.

https://ethereum.org/en/what-is-ethereum/

It is the second-largest crypto by market cap. Also, it provides a ground for all kinds of innovation, including smart contracts, dapps, or NFTs.

So why do we need Ethereum 2.0?

Well, Ethereum is currently in the process of upgrading to Ethereum 2.0!

Ethereum 2.0 is a new and improved version. It will try to address the common criticism of being too slow, too expensive, too limiting. Ethereum 2.0 will try to resolve those issues.

Background on Ethereum:

Let’s dive into the background of Ethereum: Psst… You can skip this part if you already know it all 😉

Ethereum was conceived in 2013 by programmer Vitalik Buterin and was finally built by a team of developers in 2015.

In its most simplified term, Ethereum is a technology that lets you send cryptocurrency to anyone for a small fee. It also powers applications that everyone can use, and no one can take them down.

It’s the world’s programmable blockchain.

https://ethereum.org/en/what-is-ethereum/

Ethereum builds on Bitcoin’s innovation, with some significant differences. Because it is added to its added token Ether, it also has features like a smart contract. This means Ethereum is for more than payments. It’s a marketplace of NFTs, financial services, games, and apps that can’t steal your data or censor you.

So what are the issues?

Ethereum is too slow, handling only up to 30 transactions per second (TPS). In addition, it uses Proof-of-work (PoW) consensus, which is needed to mine Ethers, and you need a lot of high-power GPU (meaning tons of electricity).

This brings us to Ethereum 2.0, an attempt to solve these issues.

How does Ethereum 2.0 differ from Ethereum 1.0?

One of the main differences from Ethereum 1.0 is that Ethereum 2.0 will use a proof-of-stake (PoS) mechanism. In my review article, I explain the difference between PoS and PoW: Distributed Ledger Technologies for Network Slicing: A Survey.

PoS is far more energy-efficient than PoW. It means that you don’t need a lot of computing power to secure the blockchain or mine the blocks.

Another difference will result in scaling: Ethereum 2.0 promises up to 100,000 transactions per second. This increase will be achieved through the implementation of shard chains.

Will it be still secure?

Since PoS networks have a small set of validators, which makes for a more centralized system and decreased network security, Ethereum 2.0 requires a minimum of 16.3K validators, making it much more decentralized — and hence, secure.

What about the price of Ethereum?

Well, more scalability may be more practical, which can mean that there may be more demand.

But only time will tell when Ethereum will be able to hold its promises. While there are, more blockchains are coming forth with faster and cheaper solutions.

When Will Ethereum 2.0 Be Released?

Unfortunately, the ETH 2.0 Launch has suffered some delays in the past. Therefore, the last phase of the upgrade is yet to happen. However, Vitalik announced the previous year’s closing that works accelerated, and in 2022, the full launch would happen.