What to expect from Ethereum 2.0?
Takeaways from second-largest blockchain’s Istanbul Mainnet activation
The Crypto bears have been in control of the broader market in Q3' 2019. However, the sagging fortunes of the digital assets have received a lifeline in the last few days with the premier coin Bitcoin bouncing hard from the medium-term support of $7300. On the heels of BTC, Alt.coins have seen some positive action as well. Ethereum has also rebounded from MT support of $160. This is significant for the biggest Alt. coin since the main net activation for its system-wide upgrade, Istanbul, is scheduled for the week of Dec. 04.
There was another system-wide upgrade earlier this year dubbed as Constantinople — implementing five Ethereum Improvement Proposals (EIPs). The twin upgrade of Constantinople & St. Petersburg was implemented on Ethereum’s 7,280,000 mined block.
Istanbul upgrade would be implemented in two stages where Part 1 will be the eighth hard fork on the $21 billion blockchain network. It will implement six backward-incompatible code changes. Of all the changes, EIP 1884 is perhaps the most controversial one — this one will increase the computational costs of retrieving data from the network for application developers.
As announced by the Ethereum core developers conference, the Istanbul main net will be rolled out at block number 9,056,000. However, if any technical issues were to surface with the software upgrade, the main net activation would be delayed one month to Jan. 8.
This prudent & flexible approach is being adopted considering the deadline for Constantinople's hard fork was pushed forward at the last moment, after a security vulnerability in one of the five Ethereum Improvement Proposals (EIPs).
Some of the major changes that you should expect to see from this system-wide upgrade are the following:
- Dubbed as the part of Ethereum 2.0 upgrade, the newer version of the network is the shift from energy-intensive Proof of Work (PoW) algorithm to a more secure & scalable Proof of Stake (PoS), where the latter requires block validation by stakeholders rather than block miners performing complex computations.
- While the main net is going to launch on Dec. 04, 2019, a complete transition to Ethereum is expected by Jan. 03, 2020. Stakeholders, developers & major Ethereum clients like Geth and Parity are expected to complete the transition during this period to avoid any hiccups.
- To be eligible to perform the function of a master node or for staking requirements, one must own 32 ETH on the network. A comparison chart of other staking platforms & their requirements is provided above.
- The new economic model of Ethereum suggests that validators can be expected to earn anywhere between 4.6% — 10.3% in annual returns.
- The cost of the hardware to run the new version of the Ethereum blockchain as a result of the new design proposal floated by the founder Vitalik Buterin.
- And also the new model provides a dynamic rewards scale which is adjusted to reflect the validators stake in the network. To calculate the net returns, you can use the ETH 2.0 Calculator in the Telegram app.
- However, the new model of Ethereum 2.0 maintains an inflation rate of less than 1%.
The move to Ethereum 2.0 launch & Bitcoin halving in 2020 will be two significant events that may have far-reaching consequences on the general Crypto market.