The Ethereum 2.0 deposit contract has just been released on Github, with Genesis time set at Dec 1, 2020, 12pm UTC! This begins the transition towards the ETH 2.0 (also called Serenity) upgrade – the next iteration of the world’s computer and Proof of Stake (POS) consensus mechanism.
The contract deposit on was announced on Twitter by none other than Vitalik Buterin a few moments ago.
Once ETH 2.0 is operational, stakers will be able to run validators and provide processing power to the new network relying on POS (Proof of Stake). Staking is done by depositing 32 ETH or multiples thereof, which will be rewarded with ETH tokens, in return for securing the contract. It should be noted that Beacon Chain only stores and manages the registry of validators and doesn’t process transactions or stores data yet.
That functionality will arrive with later phases. For now, staking validators deposited ETH token can’t be withdrawn or removed. The same goes for the staking rewards, they would essentially have to wait 1-2 years to do so, once the new network becomes capable of processing transaction and data storage. The current Proof of Work (POW) blockchain will continue working until then, to ensure continuity of the network until full release.
It is being expected that a variety of staking services will become available in the coming weeks, particularly led by blockchain companies and especially exchanges. They would arrive with different service charges and naturally trade-offs.
The staking solution can ensure increased participation from general users, as running an own validator node is both technical and risky (due to rewards slashing penalty for malfunction). Also, with third party solutions, users can participate with less than 32 ETH tokens.
Ethereum 2.0 deposit contract arrival wasn’t exactly a mystery, with developers and analysts warning of an imminent deployment, after the latest series of testnet experiments. Now, starts the wait for the Beacon Chain, which is likely a few weeks away, to bring full Phase 0 Proof of Stake (POS) functionality.
About Ethereum 2.0
Ethereum 2.0 is the next big upgrade for the Ethereum network. It will bring Proof of Stake (POS), eWASM and sharding. It will reduce the resources, required to run the Ethereum network, as well as bring scalability and performance improvements.
The Eth2 upgrade will be implemented in three phases, with the first Phase 0 Beacon Chain, expected by the end of Q2 2020, which will introduce the staking facility. This will be followed by the Phase 1 in Q1 2021, which will introduce sharding and allow data to be stored on shards, however transactions can’t still be processed.
The Phase 2 will make the Ethereum 2.0 truly complete and the network operational, after its introduction at some point in 2022. It will bring the Ethereum WebAssembly (eWASM) replacing the now operational Ethereum Virtual Machine (EVM). Only after the Phase 2 has been rolled out, proper execution of smart contracts and transactions can commence on the new Eth2 chain. The Eth1 and Eth2 chain will gradually merge with each other.
You might also like
More from Blockchain
If you have a creative streak and want to create digital artworks yourself to become an NFT Millionaire, we advise …