Connect with us

Blockchain

What You Want to Know About ETH 2.0 Rollout

Ethereum 2.0 (ETH2) has not yet fully launched, for the Ethereum Foundation decided to roll out the wide-ranging update in phases. There is still much left to be implemented. Transactions are not yet processed by stakers, so miners will still be needed. ETH2’s full implementation remains one or two years out. Once fully implemented, ETH2 … Continued

The post What You Want to Know About ETH 2.0 Rollout appeared first on BeInCrypto.

Avatar

Published

on

The Beacon chain, which has been rolled out as part of phase 0, is essentially the basic necessities of the protocol. From a price and market perspective, as ethereum (ETH) becomes increasingly staked, ETH2 could introduce ETH scarcity on centralized exchanges, driving prices up.

Ethereum 2.0 (ETH2) has not yet fully launched, for the Ethereum Foundation decided to roll out the wide-ranging update in phases. There is still much left to be implemented. Transactions are not yet processed by stakers, so miners will still be needed.

ETH2’s full implementation remains one or two years out. Once fully implemented, ETH2 will be a great development for the blockchain industry. In Ethereum’s current form, during periods of high transaction volume, it can be unpredictable. At the end of September 2020, for example, users couldn’t interact with the blockchain, because it was too congested. With ETH2, the hopes are something like that will no longer be the case. Here’s what to expect. 

Proof-of-stake

Proof-of-work (PoW) initially secured and maintained the Ethereum network. Since Ethereum has not yet migrated to proof-of-stake (PoS), miners still earn rewards for creating and validating blocks on the blockchain. It must go, however, because PoW isn’t deemed scalable for Ethereum’s purposes. In the Ethereum model of PoS, those with 32 ETH can stake, become a validator, and get paid to confirm transactions.  

Sharding

Presently, anyone who wants access to the Ethereum network must do so through a node, which stores a copy of the entire network. The node must download, compute, store, and process every single transaction since Ethereum’s genesis block. This process slows down the overall network.

Shard chains are similar to other blockchains, except they only contain specific subsets of one whole blockchain. Nodes then only manage a slice, or shard, of the Ethereum network. This should increase transaction throughput and Ethereum’s overall capacity.

The Beacon chain

As the shard chains work in parallel, they need to stay in sync. Enter the Beacon chain, which provides consensus to all the shard chains running in parallel. The Beacon chain is a novel blockchain central to ETH2. It allows information to be shared between shards and for the network to scale. 

The timeline of ETH2 rollout

ETH2 will be released in three phases. The first is phase 0, and it launched on Dec. 1 2020. It marks the release of the Beacon chain, which is central to shard chains, which won’t be released in this phase. The Beacon chain, to be sure, will begin accepting validators (i.e. stakers) through a one-way deposit contract.

Registered validators who stake their ETH won’t be able to “unstake” until shard chains have been implemented, meaning ETH from validators will be locked until the next phase. The ETH2 deposit contract reached the required minimum of 524,288 ETH to launch. 

In the second roll out, comprising phase 1/1.5, and expected to be implemented during 2021, shard chains will be introduced early on so validators can create blocks on the blockchain through PoS. Phase 1.5 is when Ethereum’s mainnet officials introduce shard trains and begin the transition from PoW to PoS. 

In phase 2, ETH2 will fully support formed shards and become the official Ethereum network. Shard chains will be able to work with smart contracts, as well, so that developers of dApps and other technologies can integrate seamlessly with Ethereum 2.0. Phase 2 is expected in 2021 or later. 

The final phase is docking. In this phase, since ETH2 had been deployed and built in parallel to the Ethereum network, the two networks are merged. This is expected sometime in 2021 or 2022.

The future of ETH2

The future of ETH2 could be bright. For instance, United States-based digital currency exchange Coinbase outlined plans for supporting ETH2 staking rewards in early 2021. Once supported, Coinbase customers could convert their ether tokens to ETH2 and earn staking rewards. 

“While staked ETH2 tokens remain locked on the beacon chain, Coinbase will also enable trading between ETH2, ETH, and all other supported currencies providing liquidity for our customers,” wrote the company, which recently filed for an IPO.  

ETH2 should yield far better throughput, and more predictable performance, than the current iteration. If Ethereum is to be more reliably used, it is crucial that the protocol level improvements will provide more predictability for the blockchain’s users.

This long-awaited upgrade to the Ethereum network promises big improvements to the functionality and experience of the network altogether. With a shift from PoW to PoS, shard chains, and a new blockchain at its core called the Beacon chain, the next two years will be an exhilarating time on the Ethereum network. 

The implications of the migration are considerable. The DeFi ecosystem has largely been built on Ethereum, which led to many of the scalability issues. While the number of transactions taking place on the Ethereum network has increased, transaction fees increased, ETH2 should address these scalability issues.

NOTE: The views expressed here are those of the author’s and do not necessarily represent or reflect the views of BeInCrypto.

Share Article

With a background in IT spanning Software Engineering, Business Analysis and Intelligence and Infrastructure Architecture, CryptoShark first found the Cryptocurrency space through mining Ethereum from a spare gaming computer and later developed the popular decentralized charting platform, ChartEx.
Working in the FinTech industry, it wasn’t long before he started applying his analytical skills, coupled with a software engineering background to build tools to analyse trading data from emerging exchanges. This led CryptoShark to build ChartEx, a leading provider of full candlestick charting and other widely used trading tools for markets in the largest exchanges in the industry.

Follow Author

Source: https://beincrypto.com/what-you-want-to-know-about-eth-2-0-rollout/

Blockchain

NEXT Chain: New Generation Blockchain With Eyes on the DeFi Industry

[Featured Content] The cryptocurrency industry is booming throughout the past year, and the increase in the total market capitalization is definitive proof. The market is, at the time of this writing, valued at about $1.5 trillion. The same can be said about the DeFi industry. The total value locked in various protocols exceeds $39 billion, […]

Avatar

Published

on

[Featured Content] The cryptocurrency industry is booming throughout the past year, and the increase in the total market capitalization is definitive proof. The market is, at the time of this writing, valued at about $1.5 trillion. The same can be said about the DeFi industry. The total value locked in various protocols exceeds $39 billion, […] Checkout PrimeXBT
Source: https://cryptopotato.com/next-chain-new-generation-blockchain-with-eyes-on-the-defi-industry/

Continue Reading

Blockchain

‘Bitcoin Senator’ Lummis Optimistic About Crypto Tax Reform

Sen. Cynthia Lummis, the first in the Chamber to own Bitcoin, says bipartisan support will accelerate crypto tax reform.

Avatar

Published

on

Sen. Cynthia Lummis (R-Wy) expressed hope on Wednesday that Congress will be able to reform the tax rules governing cryptocurrency, which have been a longtime bugbear for Bitcoin owners and the burgeoning crypto industry.

“We’re optimistic we can find bipartisan agreement on that issue,” said Lummis during a meeting with crypto executives and policy makers on the social media app Clubhouse.

The comment from Lummis, who has owned Bitcoin since 2013, came in response to a question about whether Congress will pass a proposed law calling for a “de minimis” tax exemption for small cryptocurrency transactions.

Currently, IRS guidance stipulates that any minor crypto transaction—such as sending $5 worth of Bitcoin to a friend or using it to buy a cup of coffee—can amount to a capital gains event. Critics say this rule creates needless tax headaches, and discourages innovation by limiting the use of crypto in day-to-day transactions.

And while the IRS has become preoccupied with collecting tax on crypto—a question about virtual currency is now at the top of filers’ income tax return—the agency has done little to simplify the process for reporting it.

Lummis’s interest could help accelerate the passage of crypto tax reform, which has been proposed in bills before the House of Representatives, but never in the Senate. Lummis, whose home state of Wyoming has branded itself as a crypto hub, also pointed to a new Financial Innovation Caucus she is leading with Sen. Kyrsten Sinema (D-Az) as evidence of bipartisan interest in the issue.

Bitcoiner Cynthia Lummis Wins US Senate Seat

Policy researchers on the Clubhouse call cautioned, however, that passage of crypto legislation is unlikely to occur in the near future. The Biden Administration and Congress is currently wrangling over weighty issues related to the pandemic and economic stimulus, so crypto taxation—a relatively boutique issue—is unlikely to be a high priority.

More broadly, members of the call noted that lawmakers are becoming more knowledgable about cryptocurrency, and not only at the federal level.

Nathan McCauley, the CEO of crypto storage service Anchorage, said that his company has been speaking with several state governments about adding crypto to their corporate treasuries—a move that would mirror what big private sector companies like Tesla and Square have done in recent months.

McCauley suggested the states’ interest in crypto is related to a search for alternate finance and investing options at a time when bond markets are in a prolonged slump.

Checkout PrimeXBT
Source: https://decrypt.co/60059/bitcoin-senator-lummis-crypto-tax-reform

Continue Reading

Blockchain

Billionaire Hedge Fund Manager and a Former CFTC Chairman Reportedly Invested in Crypto Firm

The hedge fund manager who predicted BTC’s rise to $40k in 2018 and the former CFTC Chair, a.k.a ‘crypto dad’, have invested in BlockTower Capital.

Avatar

Published

on

The hedge fund manager who predicted BTC’s rise to $40k in 2018 and the former CFTC Chair, a.k.a ‘crypto dad’, have invested in BlockTower Capital. Checkout PrimeXBT
Source: https://cryptopotato.com/former-cftc-chairman-and-a-billionaire-hedge-fund-manager-reportedly-invested-in-crypto-firm/

Continue Reading

Blockchain

Bitcoin Price Analysis: Back Above $50K, But Facing Huge Resistance Now

Bitcoin is up by a solid 6% today as the primary cryptocurrency surged by over $3000 over the past 24 hours. Quick recap: bitcoin is recovering after a heavy correction over the past week, in which the cryptocurrency dropped by around 25% as it broke beneath the February ascending price channel (as shown on the […]

Avatar

Published

on

Bitcoin is up by a solid 6% today as the primary cryptocurrency surged by over $3000 over the past 24 hours. Quick recap: bitcoin is recovering after a heavy correction over the past week, in which the cryptocurrency dropped by around 25% as it broke beneath the February ascending price channel (as shown on the […] Checkout PrimeXBT
Source: https://cryptopotato.com/bitcoin-price-analysis-back-above-50k-but-facing-huge-resistance-now/

Continue Reading
Blockchain7 hours ago

NEXT Chain: New Generation Blockchain With Eyes on the DeFi Industry

Blockchain7 hours ago

‘Bitcoin Senator’ Lummis Optimistic About Crypto Tax Reform

Blockchain7 hours ago

Billionaire Hedge Fund Manager and a Former CFTC Chairman Reportedly Invested in Crypto Firm

Blockchain7 hours ago

Bitcoin Price Analysis: Back Above $50K, But Facing Huge Resistance Now

Blockchain7 hours ago

Institutional Investors Continue to Buy Bitcoin as Price Tops $50K: Report

Blockchain7 hours ago

TRON’s First Cross-Chain Prediction Market Comes Through a Partnership with Prosper

Blockchain8 hours ago

Dogecoin becomes the most popular cryptocurrency

Blockchain8 hours ago

Dogecoin ($DOGE) Developers Announce Update For Internet’s Favorite Meme Cryptocurrency

Blockchain8 hours ago

UK Budget Avoids Tax Hikes for Bitcoin Gains

Blockchain9 hours ago

Kings of Leon are releasing an album as an NFT

Blockchain9 hours ago

CertiK’s COO on the future of blockchain security and the normalisation of crypto-insurance

Blockchain9 hours ago

Biggest Digital Yuan Trial to be Rolled Out in Chengdu, China

Blockchain9 hours ago

Dan Larimer’s newest project is another attempt at decentralized social media

Blockchain9 hours ago

Crypto Analyst: BTC Hit Relative Low For Now, Rally to $54K Likely

Blockchain9 hours ago

Ark Invest CEO Cathie Wood Addresses Bitcoin FUD

Blockchain10 hours ago

SigmaUSD – Ergo’s Community Deployed Stablecoin Is Live!

Blockchain10 hours ago

Budget 2021: UK Bitcoin Owners Relax as Capital Gains Tax Stays Flat

Blockchain10 hours ago

Ethereum Lacks Strong Momentum Above $1550, Dips Are Limited

Blockchain10 hours ago

Blockchain10 hours ago

Blockchain10 hours ago

Blockchain10 hours ago

Blockchain10 hours ago

Blockchain10 hours ago

Bitcoin Cash Fluctuates Between $445 and $560 as Bulls and Bears Reach Equilibrium

Aviation10 hours ago

Ryanair Pledges To Support Sustainable Aviation Fuels

Blockchain10 hours ago

Blockchain10 hours ago

Blockchain10 hours ago

Blockchain10 hours ago

Blockchain11 hours ago

The reformed Bitcoin Maxi who saw the light: Erik Voorhees

Trending