PRESS RELEASE: Ethereum 2.0 Optimism High But That Road Is Long; Speed Vs Quality?

A strong foundation was laid for Ethereum 2.0 in 2020 and expectations are still positive for the future of the smart contract platform this year.

Ethereum has managed to constantly follow a roadmap for its constant evolution to a proof-of-stake (PoS) consensus protocol. Notably, 2020 saw the groundwork for Ethereum 2.0 majorly laid. The smart contract blockchain has strongly established itself as a dependable platform that is backed by the second-most valuable crypto in the world which is Ether (ETH).

It has also become a key resource for developers to create various blockchain-based tools and applications. The emergence and growth of the decentralized finance (DeFi) segment have been majorly developed on top of the Ethereum blockchain, adding credence to the platform’s decentralized functionality. However, the increase in the use of the blockchain has come at a high price.

Transaction costs and network speed are directly affected by more users and platforms getting added to the blockchain. That is a huge driving force behind the transition to Eth2 that is already underway.

There appear to have been many positive sentiments toward the current shift to Eth2 last year, and there is a sense of great expectation for the project at the dawn of a new year. Now many people wonder, what are the key hopes for the next step in Ethereum’s evolution in 2021?

Ethereum 2.0 Overview

Ethereum 2.0 is perceived by many to be the next major step in blockchain’s move from a proof-of-work consensus protocol to a proof-of-stake algorithm. It is an integral component of Ethereum’s development to ensure that the blockchain is made more secure, scalable, and sustainable.

The aim is for it to support thousands of transactions per second to make applications faster and cheaper to use. Security is a primary concern. Hence, a shift to proof-of-stake needs to guarantee that the protocol is more secure against any of the existing and possible forms of attack.

Lastly, the move away from the PoW method is important to minimize the environmental impact that the Ethereum network has. This network in its current state needs massive computing power and electricity to remain sustainable.

The initial phase is the Beacon Chain that is responsible for the introduction of PoS to the protocol. It was launched on December 1, 2020. In that context, the Eth2 users can now stake their ETH and become validators of the network.

Being a full validator needs the users to stake 32 ETH and will see the users process transactions and develop new blocks on the chain. That is imagined as the future of securing the Ethereum network and will ultimately replace the current energy-consuming PoW consensus mechanism.

With the Beacon Chain now live, the next step is the launch of shard chains . This launch is scheduled to happen sometime in 2021. In general, sharding enables a database to split up allowing it to spread the workload. Ethereum is projected to use these shard chains to minimize network congestion and enhance transaction speed.

Moreover, it will majorly reduce the hardware needs of running a node. The plan is the develop 64 shard chains. On its part, the Beacon Chain will in the end assign particular shard chains to different validators and that will spread out the work required to validate the Ethereum blockchain .

The initial iteration of these shard chains will not have the capacity to handle transactions or smart contracts. Instead, it will just store and manage data on the network. The long-term aim is to integrate shards with rollups which will eventually bundle transactions off-chain to get subsequently submitted back to the mainnet.

When that happens, it will majorly improve the transaction processing capacity of the Ethereum network.

A Vote Of Confidence

Reporters contacted several individuals who are working at the front line of Ethereum’s continuing development. The lead product owner of Teku, Ben Edgington, has participated in the research and development of Ethereum 2.0 directly. Teku is an Eth2 client that is created by ConsenSys and designed mainly for enterprise and institutional stakers.

A primary talking point of the continuing shift to Eth2 has been the amount of ETH that is staked in the Beacon Chain contract. Edgington told reporters that the community’s willingness to participate in the staking process has been quite positive for the developers:

“The amount ETH already staked is an immense vote of confidence, not only in the Beacon Chain but also in the future of Ethereum. I am impressed by how much has come in so quickly, and greatly encouraged by the commitment of the Ethereum community to what we have built, and will be continuing to build.”

Edgington also said that the launch of the Beacon Chain was maybe the most challenging part of the Eth2 project. It was recognized as a major milestone that has enhanced confidence for the forthcoming stages in Ethereum’s journey.

One protocol specialist working for Bison Trails blockchain infrastructure provider, Viktor Bunin, told reporters that the continuing staking of ETH indicates that there is massive support from the community in the future of the protocol, stating:

“I was surprised that the inflows have continued to be so large and think there’s a chance that the queue to enter Eth2 does not run dry for all of 2021, meaning there is always a wait for a validator to join the network because so many are trying to join simultaneously.”

Buterin And Lubin Have High Hopes

Back in December 2020, ConsenSys founder Joseph Lubin said that the transition to the next phase of Ethereum 2.0 may happen faster than expected since the Beacon Chain is now live. Lubin highlighted during the “Ethereum in the Enterprise — Asia Pacific 2020” conference:

“People in the know around the ecosystem are very optimistic about how fast things could unfold, as the complicated work has been done in launching Phase 0.”

Lubin also said that the Ethereum Foundation is anticipating shards to rapidly improve data availability on the Ethereum blockchain when they get deployed. He went on to say that Ethereum 2.0 may absorb Ethereum 1.0 “in the not too distant future.”

Vitalik Buterin, the Ethereum co-founder, provided some insights into the current development of the ecosystem in an online meetup that is hosted on YouTube by Ethereum Buenos Aires on December 29, 2020. He highlighted the main aims for the Ethereum ecosystem in the coming 12 months.

A major worry currently is the cost of transactions on the blockchain which Buterin said is still a sticking point:

“We need to be working very hard on making sure that there’s more space for transactions so that we don’t have this dynamic where everyone is bidding for a very small amount of space so that only very few transactions can get in.”

Vitalik also highlighted that Ethereum aims to have the ability to support hundreds of millions of users in the next few years. But for now, the blockchain can support between 15 and 45 transactions every second.

The Ethereum co-founder then went through a mid-term scalability roadmap and commented on the possibility for rollups to enable the network to process 1,000 to 4,000 transactions per second. When Eth2 sharding and rollups get deployed together, Buterin said that the potential for 25,000 to 100,000 transactions processed every second.

Finally, Vitalik concluded by saying that by the end of this year, he wants to see the current development roadmap of both the Eth1 (PoW) and Eth2 (PoS) chains completed and to have operational testnets for the complete integration of the two chains along with sharding capability. He added:

“Potentially, the light client support for the proof-of-stake chain even before the merge could be used to provide better light client support for the proof-of-work chain.”

Ethereum Developers Trust The Entire Process

According to reliable sources, a natural theme that has emerged in the current evolution of Ethereum has been a focus mainly on quality. Even though multiple timelines have been established, the developers have strived to create and implement upgrades that are not rushed.

Bunin told reporters that different Ethereum users, developers, and firms that he had been in communication with in the past few years have expressed their unhappiness with the amount of time taken to launch the Beacon Chain but they were very excited by the news of the long-awaited launch:

“They did not take shortcuts with the Phase 0 design and were not afraid to go back to the drawing board after failed attempts or upon discovering new optimizations. They will and should continue to optimize for the best design rather than speed of execution.”

As Buterin said in December 2020, the 2021 roadmap features development goals for both Eth1 and Eth2. The latter features work on shard chains that promise to enhance the scalability of the protocol. On his part, Edgington said that he was hoping to see these shard chains launched by the end of this year. However, all that will depend on the sheer scale of work scheduled for 2021:

“The design for sharding is well advanced, and I expect we’ll make excellent progress towards implementing it this year. I’d personally hope to see shard chains launched in 2021, but we don’t yet have a target date. Besides, we have brought forward the merger of Eth1 and Eth2 in the roadmap, so we will be working on that in parallel with sharding.”

There is growing pressure to deliver performance-improving upgrades in 2021. DeFi was a major subject that dominated 2020 and has added some strain to the Ethereum blockchain. Nonetheless, Edgington repeated the view that the ETH community of developers would not be reactive to such kinds of pressures in the approach of 2021:

“There’s always been a sense of urgency, irrespective of DeFi! […] The tension between doing things right, and doing them quickly is always present, but I feel that we are in a reasonable place.”

Bunin also thinks that the development of the shard chains will not entirely get expedited and added that the developers’ mindsets are now optimized for quality since:

“they are building the financial infrastructure of the next century. My expectation is that shard chains will be launched by the end of 2021, but I am also comfortable if they are delayed.”

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This is a syndicated post from https://www.cryptovibes.com/blog/2021/01/12/ethereum-2-0-optimism-high-but-that-road-is-long-speed-vs-quality/