Ethereum 2.0

What is Ethereum 2.0?

The rebranding is meant to represent the reality that Ethereum 2.0 is a network upgrade rather than a new network. As a result, ETH1 is now known as the "execution layer," which houses smart contracts and network rules, and ETH2 is known as the "consensus layer," which ensures that devices contributing to the network follow its rules. The name Ethereum 2.0, on the other hand, has persisted.

What is the difference between Ethereum and Ethereum 2.0?

While Ethereum 1.0 uses a proof-of-work (PoW) consensus process, Ethereum 2.0 will use a proof-of-stake (PoS) method. There is a need for decentralized transaction validation using blockchains like Ethereum. Ethereum, like Bitcoin and other cryptocurrencies, currently uses a proof-of-work consensus process.

Miners employ the computing capacity of a machine to solve complicated mathematical puzzles and validate new transactions in this system. The first miner to solve a challenge adds a new transaction to the blockchain's record of all transactions. They are then given the network's native coin as a reward. This technique, however, can be quite energy-intensive.

Proof of stake differs from mining in that users can stake a network's native cryptocurrency and become validators instead of miners. Validators, like miners, validate transactions and ensure that the network is not executing false transactions. These validators are chosen to propose a block based on the amount of cryptocurrency they have staked and the length of time they have staked it.

Other validators can then confirm that a block has been seen. A block can be added to the blockchain once there are enough attestations. The successful block proposition is then awarded to the validators. "Forging" or "minting" is the term for this process. The fundamental advantage of PoS over PoW is that it decouples energy-intensive computer operations from the consensus mechanism, making it significantly more energy-efficient. It also means that securing the blockchain does not necessitate a large amount of computational power.

What is the future of Ethereum 2.0?

Sharding is a technology that Ethereum 2.0 aims to use to increase its capacity. This is a popular strategy among newer PoS coins since it allows them to scale without sacrificing security or decentralization.

Sharding is a method of partitioning a database into smaller, more manageable chunks. With a PoW blockchain, the majority of nodes, or computers in the network, have a complete copy of the transaction history. This entire history, especially for older cryptocurrencies with a significant history of transactions, might take up a lot of space.

Sharding divides the blockchain into parallel portions, with nodes assigned to one section rather than having to store the entire chain's data. This allows for the processing of multiple transactions at the same time, dramatically boosting throughput and transaction speed.

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