Ethereum founder Vitalik Buterin announced that Ethereum 2.0 is underway. With a vision to make his brainchild more efficient and seamless, ETH users should expect major changes with the digital asset’s overall performance.
Ethereum is one of the most important digital assets in the market right now. With a market capitalization of 44.17 billion, ETH trails behind Bitcoin as the top-performing cryptocurrency. Currently, there’s a lot of buzz around the highly-anticipated upgrade of Ethereum.
According to Buterin, the 2.0 version of Ethereum will have new changes such as the proof-of-stake solutions. Under this is the Beacon Chain and the Casper FFG. He said he wanted to improve the asset’s scalability and security.
The proof-of-stake (PoS) concept of ETH 2.0 will introduce major changes to how ether coins are mined. This new consensus mechanism will give rewards to miners for validating blocks. Once a validator ‘stakes’ their token, it will be locked by a binding algorithm that secures the transaction. Meaning, once the validators present the blockchain stakes, they use their own tokens as collateral.
Compared to ETH 0.1’s proof-of-work mechanism, PoS is more efficient in terms of the resources expended to validate a transaction. Since proof-of-stake doesn’t require miners, the upgrade is more sustainable and generates less energy consumption.
Danny Ryan, Ethereum’s developer, said that he’s expecting that ETH users will see the improvements once they shift from ETH 0.1 to 2.0.
‘We want to increase the layer one capacity of the [Ethereum] system by approximately 100x. The benefits we hope to bring to developers is more capacity, cheaper transactions and a better environment for users to interact with and build Dapps on’.