Bitcoin

Ethereum 2.0 contract reaches 100,000 ETH


newly Mail On CryptoQuant by TemptingBeef confirmed that the number of Ethereum stacked in the ETH 2.0 deposit contract has now exceeded 100,000. This means that the ETH stack is now more than 5% of the amount of Ethereum currently in circulation.

Chart showing the amount of staked ETH over time | Source: TemptingBeef on CryptoQuant

ETH 2.0 has been in the pipeline for a number of years now. The hopes were that proof of ownership of Ethereum would be revealed in 2020. But the developers want to make sure the network is completely secure before it is rolled out. Users are waiting for release dates to be announced as it looks like the release will be delayed again since it wasn’t ready yet.

People are the reason for the delay

According to Ethereum founder Vitalik Buterin, the biggest issue with delaying the release of ETH 2.0 was not technical issues of any kind. But people were working on it.

The CEO noted that the project was riven by internal conflicts. Resulting in a delay in the completion of the project.

Related reading | Cardano Founder: Ethereum Will Overtake Bitcoin

ETH 2.0 is a response to the growing criticism of the power consumption of proof-of-work systems used by coins such as bitcoin, as the blockchain requires miners’ computers to solve complex mathematical problems to approve transactions. This requires a high computing power of computers. Which translates to significant energy consumption by mining operations.

Ethereum 2.0 will reduce network fees and increase transaction speeds. This will be done by providing scalability to the Ethereum network. It is also expected to use 99.95% less power than Proof of Work protocols such as the Bitcoin blockchain.

This is an astonishing number when compared to the amount of energy mining is currently using. It is estimated that Bitcoin currently uses more energy annually than entire countries such as Holland And the Argentina.

It’s no surprise, then, that there has been a rush to find more energy-efficient ways to mine cryptocurrency. Mining activities are a major concern when it comes to pollution caused by the consumption of energy based on fossil fuels.

Ethereum chart from TradingView.com

Ethereum trading below $2,000 as ETH 2.0 hits milestone | Source: ETHUSD on TradingView.com

The expected transition from PoW to PoF with ETH 2.0 has been postponed to 2022. The transition was expected to take place this year. It was also announced in 2020. But it looks like investors will just have to wait another year for this step.

Benefits of Ethereum 2.0

Ethereum 2.0 will eliminate the bottlenecks currently in the network. Things like high gas charges will be eliminated during high-traffic hours. Transactions will be faster no matter how crowded the network is. Faster transaction speeds mean less network congestion.

It will also increase the security of the network. Providing more scalability and productivity.

But the main advantages lie in the energy efficiency of the grid.

The first part of ETH 2.0 is the Beacon Series, which is currently live. This is what allows users to stake their coins to get new ETH rewards.

Related reading | Ethereum to $20,000? Factors Behind Bold Call

The merge will come after that. This occurs when the main network merges with the beacon chain. It is estimated that this will happen in 2021. But at the moment, there are no exact dates for when this will happen.

Finally the cutting chains will come. It will enable Ethereum to process more transactions. It also increases the network’s ability to store data.

Shard chains will gain more features over time. These features will be rolled out in multiple phases.

For Ethereum holders, rest assured that their coins will be safe in the transition from ETH 1.0 to ETH 2.0. All data history, transaction records, and asset ownership of ETH will remain. Only new transactions will be executed on the new network.

Featured image from Bitcoin Market Journal, charts from CryptoQuant, TradingView.com



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