What is ETH 2.0?The ETH 2.0 upgrade or ‘Serenity’ promises to boost the speed, efficiency and scalability of the network. The upgrade will solve various network problems by leveraging better transaction rates and cause less congestion on the network.
Ethereum and the many projects that operate on its blockchain will greatly benefit from this upgrade. Already, it is more advanced than Bitcoin’s blockchain framework.
The roll out of ETH 2.0 that took place on 1 December 2020 is said to be the first of a few phases. The recent event changed the system from Proof of Work (PoW) to Proof of Stake (PoS). In short, it means that the Ethereum network will no longer operate on computing power provided by miners but on staking pools.
The switch from PoW to PoS means a healthier environment since it requires lower levels of energy for consumption. Also, less computing power is required to secure the blockchain.
How does ETH 2.0 affect Ethereum hodlers?If you are a long-term investor in Ethereum, the ETH 2.0 upgrade will not affect your holdings. You can go about buying and selling Ether and any other cryptocurrencies that operates on the Ethereum network, as usual.
However, with the Ethereum network making the shift from PoW to PoS, it means there are staking opportunities. By committing a certain amount of Ether to the ETH 2.0 blockchain, you can be part of the new network upgrade. ETH hodlers must stake 32 ETH tokens to be exact.
Ankr recently launched a new protocol, Stkr that offers Micropools to those who do not have 32 ETH. It’s an opportunity for investors with a lower ETH balance to get involved in staking. Another benefit to Stkr is that you won’t have the responsibility to run the node yourself. The system automatically assigns your cryptos to reputable nodes.
What’s next for Ethereum?Next up is the development of sharding chains on the Ethereum network. This is an important aspect of the overall upgrade as it will improves the Ethereum network speed. Ethereum sharding is said to occur in 2021. Following the sharding event, is phase 1.5. During this time, ETH 1.0 and ETH 2.0 will come together.
In conclusion, more than 700 000 ETH was deposited into the new Ethereum PoS system. This means that ETH 2.0 is currently one of the largest PoS blockchains beating other leading PoS chains like Polkadot, Tezos and Cosmos. ETH 2.0 is extremely bullish for Ethereum in the long run. Be sure to buy Ethereum on AltCoinTrader today!