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3 Important Things about Ethereum 2.0 You Should Know

Ethereum 2.0 is around the corner!

This next version of the Ethereum blockchain has long been the focus of the crypto community and is set to be launched on December 1, 2020.

Ethereum is the 2nd largest cryptocurrency by market capitalization. At the time of writing, 1 ETH to INR counts about ₹41,701.

With Ethereum 2.0, the company is going to introduce a number of changes to the current platform, replacing Ethereum as a whole.

Ethereum 2.0 is a highly ambitious upgrade to the Ethereum Blockchain that aims to enhance the speed, scalability and efficiency of the Ethereum network intending to process more transactions.

Ultimately, the users are both worried and excited.

Why Ethereum 2.0 Is So Important?

Two consensus algorithms are utilized in blockchains where crypto transactions are done: PoW (Proof-of-Work) and PoS (Proof-of-Stake).

The essential advancement we will see with Ethereum 2.0 will be the transition of Ethereum’s existing algorithm from PoW to PoS.

Rewarding miners or stakes to approve transactions and create new blocks is the way a blockchain produces new coins. These block rewards likewise urge network users to make sure about the platform and evade possible attacks.

The current Ethereum network is secured by Proof of Work, in which miners spend their time and heavy computing power to be able to validate a new transaction.

In this process, they compete with one another and attempt to gain Ethereum’s native currency (Ether) from each completed block, which is the native currency of Ethereum.

During this process, the more time and computing power a miner puts in; the better are their chances to complete the block.

3 Major Changes Ethereum 2.0 Will Come Along

This new upgrade to Ethereum blockchain is intended to improve both the performance as well as the adoption of the network with these 3 major rollouts.

1. eWASM

The biggest change Ethereum 2.0 will bring is that Ethereum will not be running on the traditional EVM, but rather run on eWASM.

eWASM stands for Ethereum Web Assembly which is supposed to increase the speed as well as scalability of the Ethereum since it doesn’t need any code compilations to run.

Once uploaded, the code will be auto compressed onto the Ethereum blockchain. Also, this web assembly would remove the possibility of the future hard forks, which takes the security level of the blockchain to the new level.

2. Ethereum Mining

With the new ramifications of the eWASM framework, the Ethereum Blockchain would be changing from a Proof-of-Work to Proof-of-Stake system.

Now this means that anyone owning some Ether can put forward a predefined measure of their funds to keep the system running instead of needing hundreds of miners to maintain the nodes.

At that point, their account would be arbitrarily chosen to validate a transaction.

This is also good for the environment since it requires much less electricity to run.

3. Staking

If you’re bent on becoming a staker, then you must own at least 32 ETH. Along with that, you must also have the proper software as well as hardware to match the upcoming Beacon network.

Not only this, when it comes to staking your ETH on transactions, you are exposed to a significant amount of risk involved with it.

Since Ethereum 2.0 would be an entirely new system, there are higher chances of bugs you might face right off the launch. And if you fail to validate your transaction, you might end up losing your ETH stake.

By that time, you can consider monitoring Ethereum to INR to keep yourself updated about the price happenings.

What’s Different About Ethereum 2.0?

Ethereum 2.0 will be rolled out in phases to ensure a smooth and secure transition.

Phase 0 – This is the launching of the Beacon Chain, presently working as a testnet and running with validators utilizing testnet Ether for the PoS mechanism.

Phase 1 – The introduction of Sharding for bringing the much-needed scalability.

Phase 1.5 – Incorporation of the Ethereum 1.0 Blockchain to the new Ethereum 2.0 chain. The mainnet then turns into a shard on the network and will be changed from PoW to PoS.

Phase 2 – All shards that are on the chain will work as planned alongside the ability for users to use smart contracts.

Sum Up

Whether you like it or not, Ethereum 2.0 is inching closer to its launching of Beacon on December 1, 2020. No particular activity will be needed on your part if you are a regular user of Ethereum Blockchain.

However, if you are a miner, then your world would get a renovation. And if you hold enough Ethereum, then you should consider changing to staking with a reliable crypto exchange in India.

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