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There has been a lot of hype over the online cryptocurrency forums surrounding the pending launch of Ethereum 2.0 in the past few days. Ethereum 2.0’s Ethereum, the second largest cryptocurrency by market capitalization, will introduce a number of changes to the current platform, replacing it as a whole, and users are wary and enthusiastic.
Ethereum 2.0, also known as Eth2 or “Serenity”, is an upgrade to the Ethereum blockchain. The “2.0” update aims to improve the speed, efficiency and scalability of the Ethereum network so that it can process more transactions and alleviate bottlenecks.
On November 4th, Ethereum (ETH) Lead Developers hit a significant milestone. In a blog post from the Ethereum Foundation, developer Danny Ryan confirmed the release of the v1.0 specification for the long-awaited Ethereum 2.0 update, which includes the mainnet deposit agreement address.
Ethereum 2.0 will introduce a number of changes to the current platform, replacing it as a whole, and users are wary and enthusiastic.
eWASM
The biggest change coming with Ethereum 2.0 (also known as Eth2) is that Ethereum will no longer run on EVM (Ethereum Virtual Machine) but will instead start running on eWASM (Ethereum Web Assembly). For those of you unfamiliar with EVM, it’s how Ethereum can run on a computer network rather than storing drive information on a device. So if you want to upload a smart contract to the Ethereum blockchain, you must first encode the DAPP in Solidity (Ethereum’s main encoding language) and then it will be transferred and compiled into EVM bytecode.
This EVM bytecode is completely autonomous from the device on which it was created and can now be read by any device in the system and the data is stored on a number of nodes. And once this bytecode is loaded into the EVM, it cannot be erased or wiped, which gives Ethereum its decentralized nature. On the EVM, the Ethereum blockchain works with 100% accuracy, which is what Buterin wanted when he created it. This process which ensures that every node in the system runs with 100% accuracy, however, together with the long conversion to bytecode, slows down the Ethereum blockchain enormously, limiting its scalability. On EVM, the Ethereum blockchain can only process 25 requests per second, which in the grand scheme of things is nothing.
The reason eWASM will increase the speed and scalability of Ethereum, is because unlike EVM, eWASM does not require any compilation or code modification. The uploaded code will be automatically compressed on the blockchain. This new web assembly also removes the possibility of future hard forks, which overall increases the security of the blockchain as a whole. And of course, applications will no longer have to be loaded solely in the Solidity coding language, making Ethereum much more accessible to programmers. Programmers can now use a variety of languages such as C ++, JavaScript, and Rust. All of these things combined will allow the Ethereum blockchain to far exceed its previous limit of 25 requests per second, but it will also put all current miners out of work.
Ethereum Mining
Previously, one of the main aspects of Ethereum was the fact that, unlike Bitcoin, an individual did not need special equipment to create a node and start mining. Rather it was easy enough for even the most recent programmers to set up a computer and download the program needed to get started. And these miners were needed to maintain the proof of work aspect to verify that work on the Ethereum blockchain had been completed to allow for self-completion of smart contracts. With the new implication of the eWASM system, the Ethereum blockchain will change from a proof-of-work to a proof-of-stake system. This means that, instead of needing hundreds of miners around the world to keep the nodes, now anyone with some Ether can propose a specific amount of funds to keep the system running. Their account will then be randomly selected to verify a transaction, at which time the account owner will generate the returns.
This is good for the planet, as it requires much less electricity to function. This is also good for the Ethereum blockchain, as it can be adapted more widely and easier to use as it will no longer be limited by slow processing speeds. However, this is very sad news for all miners who have invested a large part of their money in their node, as after the launch of Eth2 in December 2020, they will no longer be able to make money with their node. Not only that, but only accounts with large amounts of Ethereum can bet, so if they haven’t saved their Ether, they won’t be considered to make money with the new Proof-of-Stake system.
Strikers
If you are interested in becoming a staker, there are some important things you need to know. First of all, even to be considered, you must have at least 32 ETH. Apart from this, you must also have the appropriate hardware and software connected to the future Beacon network. You also need to understand how this network works. There are 7 different software “clients” that a staker can choose to download and run on their device to wager their coins.
Sounds easy enough, right? Well, there is a significant amount of risk when it comes to betting your ETH on transactions. Some of the problems that can be addressed right away are bugs in the system, as Eth2 will be a completely new system. While most of these bugs don’t result in a loss of funds (or hopefully not!) It’s hard to say for sure, but if you’re a bug hunter, this could generate some revenue for you. Some other risks include losing your ETH fee if you go offline or fail to validate. So if you are going to aim, the machine you are using to do so must be connected to a secure internet connection at all times. You should also consider monitoring the system frequently so that you don’t lose your investment due to breakdowns. You can also lose your ETH due to malicious activity (hacking of your system or app), so it’s important to constantly monitor unauthorized activity.
This all sounds a little scary, right? Well, keep in mind that while this doesn’t scare you, if you decide to bet, you will not be able to withdraw your investment for an unspecified period of time. For this reason, make sure that any amount invested is truly money that you don’t need access to, as withdrawals from the system depend on unspecified future updates. Additionally, an article in Forbes magazine addresses how the US government will eventually tax these mails. Therefore, there is a possibility that staking is not even worth it as the amount you will earn from staking has not yet been specified and the fees may be high.
In Sum
Ethereum 2.0 is coming whether you like it or not. And the launch of Beacon, the first part, is scheduled for December 1, 2020. If you are a regular user of the Ethereum blockchain, no specific action will be required from you on this date. However, if you are currently a miner, your world will invariably change. If you are not risk averse and have enough Ethereum, consider staking. But beware, the risks associated with staking the new Ethereum platform will far outweigh any current risks experienced by miners, so if you decide to proceed, be aware that you may lose your investment.
Via – Publish0x | Originally published on MintDice.com.
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