Tomorrow (December 4), at around 3:00 PM Tehran time, Ethereum 2.0, the long-awaited Ethereum update, will be launched. What is the current situation and what will happen next?
Also read: What is Ethereum 2.0? ; Everything you need to know
November 4 was an important turning point for major Ethereum developers. Ethereum developer Danny Ryan posted a post on the Ethereum Foundation blog announcing the release of specs for version 1 of the much-anticipated Ethereum 2.0 update. This version also included the address of the original deposit agreement. Following this announcement, anyone who wanted to participate as a validator in the main Ethereum 2.0 network can now share at least 32 Ethereums.
The initial results looked promising. In the first eight hours alone, 14,000 Ethereums ($ 5 million) were traded. However, the developers had set a minimum of 524,288 Ethereums out of 16,384 validators to launch the main network known as the beacon chain. This goal had to be achieved seven days before the final launch, on November 24, which also happened.
Sharding path; Transaction speed
Ethereum 2.0 is on the verge of launching as the number of shares traded reaches the quorum for the launch of China Bacon. But what are the next steps and when can the Ethereum become fully scalable?
Launching Bacon China is phase zero on the Ethereum 2.0 roadmap. The next significant development is planned for 2021, which will include the launch of 64 sharing chains. These chains operate through a stock-based consensus mechanism (PoS) and will be validated by Ethereum shareholders. However, shard chains in their initial state cannot support smart contracts and user accounts.
Probably the most important turning point for the current Ethereum ecosystem is phase 1.5, when the main Ethereum network joins the Chinese bacon as a shard chain. This completely shifts Ethereum to a stock-based consensus. This is also scheduled to take place in 2021, but no exact date has been set yet.
Only when the final stage of phase 2 is reached will it be possible to assess the full impact of the Ethereum 2.0 upgrade on network scalability. At that time, the Shards become fully operational and support smart contracts and a variety of transactions. However, this may take another two years. The Ethereum Foundation has stated in the Ethereum 2.0 roadmap that Phase 2 is still under research. These statements confirm that the development of Phase 2 has not yet been completed.
There is no comprehensive solution
Even if all phases of the roadmap are completed in the next 18 months, which is unlikely, the full scalability potential of Ethereum 2.0 will not be seen until 2022. However, instead of focusing on the development of Ethereum 2.0 as a game of life and death, it is better to take a holistic view of the evolution of the Ethereum ecosystem over the coming years.
Despite the criticism, until the full development of Ethereum 2.0, second-tier solutions are still the best option for Ethereum scalability. Vitalik Butrin even seems to support second-tier platforms as a way to scale current.
This year, Matic Network and OMG Network both unveiled second-tier solutions based on plasma variables. These solutions use side chains to process the load of the main Ethereum chain.
However, while plasma has been a scalable technology for some time, this year most of the focus has been on rollups, which has been endorsed by Vitalik Butrin. In addition, the Aztec Privacy Protocol has launched proprietary intelligent contracts based on Zero-knowledge rollups. Zero knowledge aggregation aggregates transactions using zero knowledge proof and validation.
Another type of aggregation solution is known as optimistic rollups, which have been developed over several projects. This aggregation strategy uses game theory to avoid the need for a heavy computational burden on zk-rolls. Eric De Moura, founder and CEO of Cartesi, explains how roll-outs work better than plasma-based scalability solutions:
Rollups solve a big problem called data availability, which is inherent in plasma. Using roll-ups, all transaction data is combined or aggregated and made available in the Ethereum. This method is cheaper than regular blockchain based transactions. In addition, all computational loads are performed outside the chain, bringing many benefits in terms of throughput and cost-effectiveness of transactions.
Cartesy is scheduled to pilot its optimistic aggregation solution in early 2021. This launch will be done with a Linux-based infrastructure, and as a result will make a scalable version of Ethereum available to developers who use core standards.
A scalable ecosystem
It should be noted that the advent of Ethereum 2.0 does not negate efforts to develop second-tier platforms that are currently trying to address the scalability problem. Instead, technologies such as roll-ups or side-folders will continue to contribute to the scalability of the Ethereum 2.0, and the capacity of these technologies will increase when sharding is fully implemented.
So prepare yourself for a long journey. Ethereum 2.0 may be ready for an initial launch, but this is just the beginning of a long journey to scalability. The continuous development of second tier solutions means that many companies are operating in this field.