The Ethereum Beacon Chain is one of the most significant upgrades to the Ethereum network in its history. The chain is a consensus layer that will help the entire network transition from proof-of-work (PoW) to proof-of-interest (PoS) and will eventually merge with the ETH main network, bringing much needed security, scalability and reduced resource waste to the main network to lower ETH’s carbon footprint.
Do you really know what the Ethereum beacon chain is?
What is a beacon chain?
The Beacon chain was launched on December 1, 2020, marking the upgrade of the Ethereum network to PoS. In essence, it is a consensus layer coordination network.
In order to understand what beacon chains can do for ETH, it is important to understand the current issues facing ETH networks. Currently, Ethereum’s consensus layer is the so-called PoW consensus layer, the same as Bitcoin’s consensus layer. This involves different nodes run by computers solving complex mathematical problems in order to reach a consensus and be able to generate the next block on the blockchain. While the system itself works fine, it becomes rather congested and unwieldy when there are many users making transactions.
The PoW mechanism, the volume of transactions per second or TPS is very low. That is, the network can currently handle 12-15 TPS, while other networks, such as the TRON network, can handle 10,000 TPS due to its more efficient consensus layer. When Ethereum processes so many transactions via a low-throughput blockchain, especially due to its ability to handle smart contracts (which we will discuss in a later article), issues such as network congestion and high gas charges occur.
So, getting into PoS, which is a way to get past the verifier and keep the Ethereum network secure, while greatly improving its TPS and making it more scalable. Not only that, but considering that proof of interest only requires a computer capable of making a pledge to be a verifier or participate in the network, this is much less restrictive than PoW. That means more participants and more decentralization, which is the cornerstone value of Ethereum and its ecosystem.
OK, so what is Staking anyway?
A pledge is a network’s way of getting help from users to secure its network and validate new transactions. When you pledge, you lock up the token for a certain period of time and then earn a reward by verifying the new block. Because people need pledged tokens to put on the line to do all this, they are naturally less likely to be dishonest.
Since the launch of the beacon chain, users have been able to become verifiers by pledging 32 Ethereum. Once the merger happens, the pledge user will get a higher reward. According to Ethereum pledge information, after the merged Shanghai upgrade, the pledgee will be able to withdraw the reward.
merge
As mentioned earlier, the beacon chain was launched at the end of 2020, which means it’s already online. So what are people waiting for? They are waiting for an event called The Merge. Its concept is simple, but its scale and significance are epic.
The merge represents the combination of this new consensus layer with the existing layer running on the Ethereum main network. It will completely replace the old execution layer and stop PoW as a form of block validation. In addition, The Merge “will reduce Ethereum’s energy consumption by approximately 99.95%,” according to The Ethereum website.
So what happens next?
The merger is expected to occur around Q3 / Q4 2022. At that point, Ethereum’s carbon footprint will be drastically reduced, PoW will cease and become PoS, and the network will become more decentralized, secure, efficient, and scalable.
Let’s wait and see the ETH2.0 era coming.