Ethereum transition to Proof-Of-Stake (POS): All you need to know
According to the hardform schedule, it starts with Bellatrix upgrade on September 6, and about September 15, The Merge should take place. In June 2022, the developers successfully integrated POS into the test networks Ropsten and Sepolia. In early August, the team completed the merger for the goerli twin. Bellatrix upgrade has already been successfully activated on September 6, on schedule.
The Merge began with the launch of a network of a network called Beacon Chain (“Signal chain”). It was in it at the end of 2020 that a special smart contract for the ETH stake, where it was possible to send funds. The upcoming update is actually the merger of Beacon Chain and the main network Ethereum.
Another important consequence of the upgrade will be an increase in safety: Ethereum will be able to more effectively reflect the attacks of attackers. The new consensus algorithm requires blocking a significant amount of funds, so the chances of accumulating the minimum necessary amount of funds are almost zero.
Another reason for the implementation of POS is the technical necessity. Without changing the algorithm, future updates are impossible to increase the scalability of Ethereum.
How will POS work in Ethereum
The Proof-OF-Stake algorithm involves the dependence of the “weight” of the validator’s voice on the number of coins included in the staining. The volume of blocked funds determines the remuneration of the node. To become an Ethereum validator, you need to introduce a minimum of 32 ETH on a deposit contract. Any holder will be able to delegate a smaller amount of coins to the validator.
To optimize computing, the participants of stakeing are divided into separate groups – committees, the composition of which is determined by randomly. The latter include from 128 to 2048 validators. To create blocks, committees can also be united.
In the updated Ethereum, the consensus achievement procedure will be divided into the so -called eras, each lasting about 6.4 minutes. These intervals are divided into 32 time slides of 12 seconds. Over the past period of time, one block is formed. Groups of committees are distributed between time slides and create elements of the chain.
The selected validator offers a block, and the rest vote for it. If the latter gained a majority of votes, it includes in the blockchain. After each era, members of the committees are shuffled. The maximum number of groups and the number of their participants is determined by the maximum emission of Ethereum, equal to 134.2 million ETH.
What income will be income eth
The commission on the Ethereum network is formed from two components: premium and basic, which is burned. After the transition to Proof-OF-Stake (POS), a fixed award for the block will not be. The income of the validators will be determined by the additional issue of ETH, which dynamically changes every era. The size of the annual issue of new coins will be calculated based on the amount of funds blocked in stakeing.
According to Staking Rewards at the end of August 2022, the Baacon Chain validators receive awards of 4.5% per annum, and the holders who delegate their funds are approximately 4% per year. As Nansen analysts found out, more than 60% of all Ethereum coins in stakes control only 4 platforms:
- Kraken; .
Analyst Messari Tom Dunlivi suggests that immediately after the merger, the profitability of the Stayking ETH will grow and will be in the range from 7% to 13% per annum, but over time it will be adjusted to the lower side.
How the price of ETH will change after the implementation of POS
Traiders are skeptical of continuing the ascending trend of ETH cryptocurrency after approaching the price level corresponding to $ 2000. Ethereum reached this mark on August 14. According to the head of Skybridge Capital Anthony Scaramucci, further growth in the cost of ETH is possible, but in the long run.
Most experts agree that The Merge will significantly affect the cryptocurrency market.
What will happen to ETH miners and whether to wait for the appearance of the Ethereum POW-report
The result of The Merge will be the impossibility of further mining Ethereum due to the so-called complexity bomb. As a result, at least part of the miners can migrate to another project – Ethereum Classic (ETC). He is a longtime fork Ethereum and is extremely close to his “parent” in architecture, but has a much smaller hashReite and general activity.
Another candidate for Ethereum miners is Ravencoin (RVN), the price of which in the first two weeks of September increased by more than 100%.
A small part of the Ethereum community intends to launch an Fork in which the Pow-Algorithm will be preserved. Its initiators are miners and manufacturers of specialized equipment. According to Chandler GO, the project can be called Ethereum Pow (ETHW).
September 13, ETHW developers presented details. The launch of the Ethereum is the launch of the Fork for 24 hours after the activation of The Merge. The exact time will be announced an hour before the start of the main network ETHW.
Meanwhile, investors do not bet on the project. As a result, by mid -September 2022, the price of the futures on ETHW has already decreased to $ 30. A number of large projects have already refused to support Ethereum Pow. Among them: Uniswap, Chainlink, Ethermine and Opensea.
It is likely that the owners of ETH will receive AIRPROP Cryptocurrencies of the Fork Ethw. The readiness to distribute free coins has already been stated in Binance and Bybit. A similar incident occurred in 2017 after the appearance of Bitcoin Cash, which was separated from Bitcoin after a hardcore.
Further updates after The Merge
The Ethereum roadmap includes the implementation of technology called Sharding, which is necessary to increase the scaling of blockchain. Charding – dividing the general database into fragments and distributed storage of information with nodes. This update will allow Ethereum to grow in accordance with the load, regardless of a significant increase in the size of the registry.
Beacon Chain allows you to coordinate the work of validators and their distribution by hearts. The algorithm realizes the sygration synchronization, due to which the latter are aware of the current state of the network. The nodes of the updated mainet will store part of the blockchain, and special algorithms will be used to verify the reliability of the data.
Charding will reduce the requirements for equipment and allow you to launch a node on laptops and smartphones. The update is planned to integrate in 2023, but the final date depends on the effectiveness of the transition to POS.
The next step after a cartoon is the deployment of the new Ethereum Webassembly virtual machine (Ewasm). It will allow the use of various programming languages to write smart contracts. Ewasm is designed to make Ethereum more efficient and should eventually replace Ethereum Virtual Machine (EVM).