Ethereum 2.0

What is Eth2?

Eth2 is a second-generation blockchain protocol with a clear intention to achieve a scalable, secure, and decentralized technology. In simple words, Eth2 is the evolution into a more sustainable and scalable blockchain. Let's make a tour around the main ideas of the proposal.

  • Explore the blockchain evolution towards sustainability and scalability.
  • Discover Proof-of-Stake (PoS) as an alternative to Proof-of-Work (PoW)
  • Learn how different shards are combined around the new Beacon Chain.

What is different in Eth2?

Although it might look like Eth2 is an entirely different protocol, all the essential components of a classic blockchain are still there. However, some new components are added. Eth2 proposes to increase the protocol's performance by deploying 64 shards, in simple terms 64 co-existing blockchains, as part of this evolution. Moreover, it leaves the old and energy-consuming Proof-of-Work (PoW) consensus aside to include Proof-of-Stake (PoS).

Wait, WHAT? Let's explain these changes more in detail.

Which is the purpose of the Beacon Chain?

The Beacon Chain emerges as the central chain that will orchestrate all the different shards. It was already deployed on December 1st 2020, and it is the heart-beat of the entire Eth2 specification. This chain compiles all the information regarding the registered validators, including their balances or resulting slashings for not performing the validator duties.

Why PoS?

PoS brings the sustainability objectives proposed by Eth2. The PoW consensus mechanism used by Bitcoin, Eth1 and many other blockchains has proved to be reliable but it imposes an enormous energy consumption.

PoS, on the other hand, relies on the validator balances and state to assign the next block proposer. To participate in the consensus as a validator, every validator has to deposit 32 ETH in a smart contract. Based on the balances of each of the validators and on the blockchain state, all the validators can calculate unanimously who is the next block proposer. Leaving aside the constant hashing competition proposed in PoW. PoS brings a more energy-efficient protocol to reduce the overall energy consumption of blockchain technology.

What is sharding?

PoS is great, but bringing sustainability to the process doesn't solve the scalability problems that the protocols are suffering. Eth2 proposes a blockchain based on the combination of 64 shards that will work in parallel. The nodes will be assigned to one of the shards, so that they cat restrict the stored and processed data to the target shard. The distribution of the blockchain duties and data among different shards brings a lighter and more scalable protocol.