Decoding Ethereum 2.0

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In the blockchain world, Ethereum could be considered as one of the most trusted and secure networks. With a large number of active clients, developers constantly working. Now it is about to get a significant upgrade. The upgrade is going to make Ethereum much faster and more secure than ever before. Some of the key updates include proof-of-stake solutions (Beacon Chain, Casper FFG), Sharding, eWASM, Plasma, Raiden, and more.

The majority of these updates are focused on addressing scaling issues(which makes the transaction faster and makes the environment better for writing smart contracts), changing the way Ethereum is mined and making the network more secure.

So What about the existing network?

There is one solution for all called Serenity. Under this concept, all the upgrades mentioned above could be combined together and another parallel chain will be formed which will be fully compatible with the existing chain.

Ethereum’s launch was initially planned to be in four stages back

1, Frontier: The initial build at launch.

2. Homestead: The build that took us into 2018

3. Metropolis: the current phase (a two-part phase consisting of two hard forks, Byzantium and Constantinople).

4. Serenity: the final stage that takes us to “Ethereum 2.0” in three phases from 2019–2021 (timeline subject to change).

How is Ethereum 2.0 is going to solve certain problems?

Below are some area where Ethereum is working to upgrade the network:-

1.Moving from proof of work(pow) to proof of stake(pos)

Proof-of-stake, or PoS, is a consensus mechanism used by some blockchains.

PoS provides those with a stake of network tokens the right to earn rewards for validating blocks. This is in contrast with proof-of-work, or PoW, the consensus model used by Bitcoin (BTC). PoW assigns block confirmation rights to those that demonstrate the largest amount of computing power.

Once a validator agrees to stake its tokens, the stake is locked up. In many cases, it will be forfeited fully or partially if the validator doesn’t act in the interests of the network — intentionally or otherwise.

In principle, anyone can stake tokens; but in reality, a protocol will be used to determine which participants get selected to validate blocks and earn the staking rewards. The right to validate a block and earn rewards is generally assigned based on the proportionate value of the stake. So, someone staking 1% of the total overall value will get to validate 1% of all blocks. However, the length of time that the stake has been locked up may also factor into the validator selection protocol.

2.Sharding

Sharding is a concept in a database management system which is used when we have to deal with a large amount of data, which makes it to locate and traverse through data difficult.so what sharding does is it is that it horizontally partitions your database and becomes much easier to handle sub-databases.

Ethereum blockchain’s architecture makes it difficult for high scalability. More the node more time it takes to verify and validate.

Sharding scales up the Ethereum network to a thousand transactions per second

The question arises how is the sharding concept used in Eth 2.0?

so what sharding does is it breaks entire blockchain into much more simple and manageable shards. And every Ethereum account will be linked to the shard.

3. eWASM to Replace EVM

One of the features that have made Ethereum such a viable platform and a worthy challenger to Bitcoin’s dominance is its implementation of what’s known as the Ethereum Virtual Machine (EVM). The EVM is an execution environment that runs on all network nodes that facilitates the use of smart contracts. It’s those smart contracts that make Ethereum’s blockchain a global computational device, rather than a mere financial system. Smart contracts on the EVM can run games, execute complex financial transactions, or even operate social networks.

Although EVM is widely used, it remains something of an enigma — even for people with a high degree of programming skill. To address this, Ethereum 2.0 will begin the use of web assembly language, in a system they’re calling eWASM. That would make it possible to execute the Ethereum app code right in today’s web browsers, which is a massive improvement over the EVM. Also, it will allow programmers to choose from several languages like Rust, C, and C++ to write code to run on the blockchain. In one fell swoop, eWASM will increase the number of potential programmers for the ecosystem, because it will open the doors to users with no need to learn a native Ethereum-only language.

4.Layer 2 Technology

To build a good blockchain ecosystem, we need a few things in the architecture to balance the needs of security, decentralization, and scalability. Layer 2 blockchain technology systems are those that connect to say, Ethereum, and rely on Ethereum as a base layer of security and finality.

In other words, rather than changing the base Ethereum, we add smart contracts on the main blockchain protocol that interacts with activities off-chain.

Layer 2 platforms and protocols process data in a way that decreases the burden the base layer (root chain) usually bears. By offloading transactions from the main chain onto layer 2 platforms, the blockchain network can handle much higher transaction throughput.


Decoding Ethereum 2.0 was originally published in Coinmonks on Medium, where people are continuing the conversation by highlighting and responding to this story.