In the last few weeks, the launch for Ethereum 2.0 has begun. Finally, the time had come and the minimum amount of 524,288 ETH was transferred to the ETH2 smart contract by 16,384 validators. In the meantime, it has even become considerably more validators and ETH. The fact that this goal has been achieved means one thing above all: Ethereum 2.0 has officially started.
But how does this start happen? What changes have users to expect? In today's article, we want to look under the hood of Ethereum 2.0 and find out how ETH is turbo-charging its transition.
Ethereum introducing proof of stake
Ethereum 2.0 has started, but this is only a first step towards the finish line. Because the starting signal was given primarily for the so-called beacon chain, which realizes the start of the new blockchain. The change to Ethereum 2.0 is so drastic that the old blockchain must simply be abandoned, but it will stay intact until the transition is finished.
One of the goals is to integrate a resource-saving consensus mechanism and replace proof of work. Ethereum 2.0 relies on proof of stake, which means that it is no longer the miners who verify the transactions, but the stakeholders. In simple terms, these stakeholders vote for the legitimacy of a transaction using their assets. In return, they are rewarded for their efforts by the network in ETH, similar to the miners.
In the case of Ethereum 2.0, these voting stakeholders are called validators and have to pay 32 ETH per validator as a collateral. In addition, the network nodes that they have to operate must be available most of the time.
Sharding plays a central role
In addition to proof of stake, so-called sharding will play an extremely important role. Ethereum 2.0 is designed to be able to link many different blockchains and run them in parallel.
As a result, the actual main chain will be relieved because only decisions are finalized on it. These linked blockchains are called shards. A total of 64 of them were planned. One of these shards will ultimately be the current blockchain of Ethereum 1.0, which can then interact with the new chain. In this way the old and the new chain will be merged.
However, it can take up to three years until all this is completed. Next year we can expect the first shards and see them interacting with the new chain. And from 2022 on, the old and the new chain are expected to be merged.