A crucial step in Ethereum 2.0’s launch is nearing. With ETH fees out of control for months, copycats, and congested networks, the crypto world looks on eagerly.
What is Eth 2.0?
It may seem like a new thing, but the idea behind Ethereum 2.0 (Eth2) began in 2014. Vitalik Buterin, a co-founder of Ethereum, apparently knew that Ethereum — which processes about 15 transactions/sec — could not handle a growing crypto space. He said:
“We will either solve the scalability and consensus problems or die trying.”
Ethereum 2.0 is meant to scale. Besides ETH fees being astronomical, with many paid astronomical fees to claim their Uniswap drops, DeFi surging in popularity, and an ever growing number of ERC-20 tokens built on ETH, blockchain is overloaded.
Last week, the official proposal for Ethereum 2.0’s Phase 0 was submitted to the community. If it is accepted, it will mean the launch of the Beacon Chain, the first part of Eth2.
With eth2's Beacon Chain due to launch in a matter of weeks, I'm looking to talk to as many staking pools as possible to see who I recommend to Week in Ethereum News readers.
If we are not already in conversation, please get in touch.
— Evan Van Ness (@evan_van_ness) September 8, 2020
Insiders have leaked that the Beacon Chain should go live in a matter of weeks, not months. Earlier in September, developer and Ethereum evangelist Evan Van Ness said on Twitter that Beacon Chain was coming, and he wanted to interface with mining pools. Now, the there is hope for the end of tx fee turmoil.
What is the Beacon Chain?
While the Beacon Chain is the first major step, it is still only the beginning. There are several layers of blockchain on Eth2 that solve many of the protocol’s scalability problems.
The purpose of the Beacon Chain is to “coordinate” the main “anchor” chain with shard chains. The Anchor layer is the Ethereum network as it exists now.
Interestingly, the idea for shards actually comes from data servers. The shard chains are basically “nodes” of information that do not include the full database. This should make the blockchain more efficient because each node will not need to store and process the entire distributed ledger.
The purpose of the Beacon Chain is to manage the shards and decide which nodes will be validators. This sort of “links” the shards together, so it must come first.
This makes it the first and most important stop on the road to Eth2.
Among many other improvements, Ethereum 2.0 is going to gradually switch to a Proof-of-Stake consensus system. Basically, this means that users will mine ETH not by running computers, but by holding tokens. Users hope this will make ETH transactions faster and cheaper.
Though there are many other similar protocols like Polkadot, EOS, Tron, Cardano, and more, ETH apparently remains the most popular smart-contract platform and has by far the biggest community of developers.
Unfortunately, even if the Beacon Chain is launched soon, there are still a number of steps before full on Eth2 arrives. Phase 1, the next step, will introduce shard chains into the mix. Then, the mainnet will become a shard. Developers are now looking at no sooner than the second half of 2021. Perhaps the competition will force the process to speed up.