What is Ethereum 2.0 and what does the ETH integration and compatibility layer consist of

The long-planned upgrade aims to improve the scalability and security level of the Ethereum network by moving from Proof of Work to Proof of Stake.

We hear a lot about itEthereum update Which is expected to lead the second largest cryptocurrency by market capitalization Proof of Work (PoW) In the Proof of Stake (PoS). It is actually a very important stage in the life of this cryptocurrency that price May he touched his own absolutely high The $4900.

when talking about Eth 2.0 We are talking about an update that is being developed in several stages that we will move to Improve the scalability and security level of the Ethereum network Through various modifications of the infrastructure upon which it is based, in particular with the passage of, as mentioned, From PoW to PoS.

What is Ethereum 2.0 and what changes is involved in it

L ‘ETH 2.0 updatealso known as Eth2 or “Serenity” that it Ethereum blockchain upgrade Which aims to increase transaction speed, improve network efficiency and scalability so that more transactions can be processed and bottlenecks are avoided.

But what does this update actually entail for the Ethereum network? Let’s assume first of all in January 2022 that a file Ethereum Foundation He stated that he will stop referring to the upgrade as Ethereum 2.0.

The renaming aims to highlight the fact that what was previously called Ethereum 2.0 is actually an upgrade of the network rather than a new one.

so we have Eth1referred to as Execution layer o Implementation level, where smart contracts and network rules are located, ed Eth2referred to as Compatibility Layer o The level of approval, which ensures that the devices contributing to the network are operating according to its rules.

When Ethereum 2.0 arrives, last update date

First of all, you have to remember that Ethereum 2.0 (This term is still used almost everywhere) It will be launched in several phases, a process that has already started in December 1, 2020 With the first update called beacon chain. There are three updates in total, as follows:

  • beacon chain
  • merge
  • shard chains

with the “Beacon Series” Offers The original staking on the Ethereum blockchainwhich is a critical step in the process of moving from a proof-of-work to a point-of-sale mechanism.

The second phase of the Eth 2.0 update is the phase called “merging”Expected between the first and second quarters of 2022, it will join the Ethereum mainnet, the Beacon chain, which was born separate from the main Eth network.

The third and final stage of the Ethereum network upgrade is called “Shard Strings” That is, shards chains, you will play A key role in the scalability of the Ethereum network. Instead of settling all operations on a single blockchain, Shard chains distribute these operations across 64 new chains.

This will include a simplification It is clear from the hardware point of view ofRun an Ethereum node Because the device in this way will have much less data to process.

So that we can reach Update finished Referred to as Ethereum 2.0, you will likely have to wait 2023 as The Ethereum Foundation itself.

What are the differences between Ethereum and Ethereum 2.0

The first difference should be highlighted with regard to Moving from Eth1 to Eth2is that in the first case we have a network that depends on the mechanism known as Proof of Work (PoW)And While the second mechanism is known as Proof of Stake (PoS).

But what exactly does this move consist of and what does it mean for the Ethereum network? In the case of a blockchain like Ethereum, it is necessary to validate transactions in a decentralized manner. In fact, Ethereum, like other cryptocurrencies including Bitcoin, is currently using a proof-of-work consensus mechanism.

It is a system in which is called “Miners” (miners) are using The computing power of the machine To process large amounts of data to solve complex mathematical problems and check for new transactions. the first A miner solves the equation It adds a new transaction to the other transactions that make up the blockchain, and it comes Awarded with original network encryption. A process, is the process that has just been described in large parts, which can require enormous energy and technological resources.

In case proof of stake While that Users can buy cryptocurrency out of the network and thus become auditors. It is thus a system that is no longer based on so-called miners, but on auditors and the risks they decide to adhere to. The Checkers are similar to miners Because their job Transaction Verification Ensure that the network does not process fraudulent transactions.

The auditors are selected to propose a based on mass On the Amount of cryptocurrency Who decided to participate, etc. The amount of time in which they will remain at stake.

Other auditors can then prove that they have faced a ban, and when there are enough certificates, it is possible Adding a block to the blockchain. At this point, the validators are rewarded for the successful block proposal, a process known as “counterfeiting” or “coin minting” in English respectively. “refine” And “mk”.

What are the advantages of moving Ethereum to Proof of Stake (PoS)

The main advantage that PoS represents is convenience underactive side, because it separates power-intensive computer data processing from the consensus algorithm. This means that You don’t need a lot of computing power to Blockchain protection with a Proof of Stake mechanism.

But among the main advantages related to Move to PoS we have the Greater network scalability. With the current system, Ethereum is able to support up to 30 transactions per second, and this causes delays and congestion. On the other hand, Ethereum 2.0 should allow up to 100,000 transactions per second, which is a huge step forward thanks to the implementation of a system called Shard Chain.

As for the current Ethereum system, let’s not forget that it is based on a single blockchain chain with consecutive blocks. On the one hand, it is a safe system but it is also very slow on the other hand, with a relatively low level of efficiency.

with the ‘Introduction of cutting chain system The blockchain is divided to allow management Transactions in parallel strings instead of cascading strings. This speeds up the network and allows for faster scaling.

Ethereum 2.0 will be more secure

investigation Higher level of security Among the goals identified by the Ethereum update. Eth 2.0 was designed thinking carefully about greater system security, in fact if most Networking based on point of sale mechanism It has few validators, which makes the system more centralized and with a lower level of security, completely different numbers are expected for Ethereum.

Indeed Eth 2.0 requires at least 16,384 validatorsa much higher number that ensures a more decentralized system with Higher security level.

Will the price of Ethereum be affected by the Eth 2.0 update?

The Ethereum price It can already be affected by the upgrade. Theoretically Greater scalability must include increased usagemore use should lead to a increasing of demandswhich, in theory, should include a ETH price increase.

Jimmy AnsonFounder Nifty Orchard And Ethereum London regulatorIt was stated in this regard: “When ETH 2.0 and aggregation work together, there will be 100,000 transactions per second of capacity.”. This will result in an absolutely perfect experience for the next billion people.”

also Matt Cutler, CEO of Blocknativeoptimistic aboutEthereum price trend after updatemostly because of the wait Reduced gas commissions after launching it.

“Our customer base sees lower transaction fees and increased network throughput as great opportunities for the future,” CEO Cutler said, then added, “What It will have a long-term bullish effect on the price of ETHdespite the short-term volatility, which is an integral part of cryptocurrency valuations.”

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