2020 is a promising year for the world of cryptocurrencies and blockchain. Bitcoin Halving and Ethereum Serenity are giving thrills to all the crypto enthusiasts. Changes are coming!
Back in 2013, a young Russian-Canadian college student and the Ethereum co-founder, Vitalik Buterin, promised to create the decentralized world computer. Ethereum has gone a long way of its blockchain development and several Hard Forks since then. But it seems, the idea can finally come true in 2020. Serenity, or Ethereum 2.0, is in today’s Futures Friday by BTCMEX.
Ethereum blockchain is powered by Ether (ETH), which is the second most widely known cryptocurrency after Bitcoin (BTC). BTCMEX earlier covered the milestones of Ethereum in a crypto throwback.
Ethereum 2.0 has been discussed and developed since 2018 and the first phase is proposed to roll out at the end of 2019.
Ethereum can now process around roughly 25 transactions per second (TPS), which is clearly not sustainable if it would go mainstream. To compare, Visa is capable of performing 24,000 TPS, and BTCMEX engine is already delivering up to 100,000 TPS.
It’s also in Ethereum’s plan to switch from Proof-of-Work (POW) to Proof-of-Stake (POS). PoW Mining is highly energy demanding and environmentally unfriendly. PoS is also supposed to reduce the blockchain running cost. PoS is also believed to improve Ethereum’s security. The introduction of Proof-of-Stake as a consensus protocol in the new Ethereum 2.0, the transactions will be considered final and will not be subject to the same 51% attack reversal tactic as in Proof-of-Work.
Serenity will also introduce sharding, which will improve the speed and throughput of ETH transactions. Vitalik Buterin explains sharding as follows:
“Imagine that Ethereum has been split into thousands of islands. Each island can do its own thing. Each of the islands has its own unique features and everyone belonging on that island, i.e., the accounts, can interact with each other and they can freely indulge in all its features. If they want to contact with other islands, they will have to use some sort of protocol.”
The Casper protocol has been created to help Ethereum make the move from a Proof-of-Work model to a Proof-of-Stake model. Sharding on Ethereum in Phase 1.0 will be introduced on top of the Proof-of-Stake Beacon Chain. Shards will be verified by a set of validators that are randomly assigned by the Beacon Chain.
Ethereum 2.0 indeed proposes radical system improvements to satisfy the latest needs of the investors and ETH believers. But, at the same time, it’s important to understand that all these changes will not happen overnight.