On November 4th, the core developers of Ethereum (ETH) ushered in an important milestone. In a “quick update” on the Ethereum Foundation blog, developer Danny Ryan confirmed the release of the highly anticipated Ethereum 2.0 upgrade v1.0 specification, which includes the mainnet deposit contract address. Anyone who wants to participate as a validator of the Ethereum 2.0 mainnet can now start depositing 32 ETH for pledge.
The initial results looked promising, with 14,000 ETH (worth about $5 million) pledged in just the first eight hours. However, when the ETH pledge amount in the deposit contract reaches 524288 ETH (that is, 16384 validators participate in the pledge, and each validator pledges 32 ETH), the Ethereum 2.0 beacon chain main network (Ethereum 2.0 stage 0) will be officially launched on December 1. This must be achieved at least 7 days in advance, so it must be completed by November 24. If the goal is not achieved, stage 0 will start 7 days after reaching the minimum pledge threshold.
Can the minimum pledge amount be reached on December 1st?
At the time of writing, the total pledged amount is less than 20%. If the pledge continues at the current rate, the Ethereum 2.0 mainnet will not be launched on December 1, but in the first few weeks of 2021.
Of course, the participation rate may change. As November 24 approaches, people’s growing expectations may encourage more people to pledge their ETH. Ben Edgington, the principal product leader of ConsenSys Quorum Protocol Engineering, remains optimistic about the launch date on December 1, and told Cointelegraph:
“I expect that as the deadline approaches, the deposit rate will accelerate significantly. There is little benefit in premature pledges, so I think people are just delaying time. It is difficult to judge whether we have enough funds to reach this threshold in time, but I remain optimistic. If Genesis is delayed, I expect the time will be short.”
These numbers indicate potential, because within a few hours of the publication of this article, the number of ETH held in deposit contracts reached a record high of 126,852.
On the other hand, the pledger will lock its tokens in a one-way contract until the current Ethereum mainnet joins the beacon chain. Although the current Ethereum 2.0 roadmap stipulates that it will be implemented in 2021, no one knows when it will be implemented.
Regardless of whether the beacon chain is launched on December 1st or in the next few weeks, there will not necessarily be the expected “big bang.” The function of the beacon chain is to ensure the security of transactions on the shard chain, and the shard chain will be available later. The current Ethereum 1.0 mainnet will continue to operate as it is now.
The road to sharding is long
So what are the next steps, and when will Ethereum be fully expanded? On the Ethereum 2.0 roadmap, the start of the beacon chain is called Phase 0. The next major progress is planned to take place in 2021 and will involve the launch of 64 shard chains, which will be verified by ETH holders under the proof-of-stake consensus mechanism. However, the shard chain will not support smart contracts and user accounts in the initial state.
The most important milestone of the existing Ethereum 1.0 ecosystem may be stage 1.5, when the Ethereum mainnet will join the beacon chain as a shard chain. This will mark Ethereum’s complete transition to proof-of-stake consensus. Similarly, it will take place in 2021, but there is no exact date yet.
Only when the final stage of Phase 2 arrives, will it be possible to assess the full impact of the Ethereum 2.0 upgrade on network scalability. Currently, sharding will be fully operational, supporting smart contracts and all transaction types. However, this may take up to two years. The Ethereum Foundation stated on the roadmap that “Phase 2 is still in the research phase,” effectively confirming that development has not yet started.
Ethereum 2.0 cannot solve all problems
Even if all the roadmap phases are completed within the next 18 months, it will not be until 2022 to see the full scalability potential of Ethereum 2.0. However, instead of focusing on the development of Ethereum 2.0 as the ultimate goal, it is better to have a comprehensive understanding of the development of the Ethereum ecosystem in the next few years.
Despite some criticism, the second-layer solution still brings the greatest hope for Ethereum’s scalability before the Ethereum 2.0 mainnet is fully operational. Even Vitalik Buterin himself seems to be inclined to use other second-tier platforms as the current expansion solution.
This year, Matic Network and OMG Network both launched Plasma-based second-layer solutions, which use side chains to reduce the processing load on the Ethereum main chain.
However, although Plasma has been the choice of extended technology for some time, most of this year’s focus has been on rollups, and Vitalik Buterin also recognized this solution. In addition, the privacy agreement Aztec has launched a private smart contract based on ZK-Rollups. ZK-Rollups uses zero-knowledge proofs to bundle transactions together to verify validity.
Several projects are also developing another type of rollups, called optimistic rollups. This uses game theory to avoid the large computational load required by zk-Rollups. Cartesi founder and CEO Erick De Moura explained to Cointelegraph why he believes rollups perform better than Plasma-based scalable solutions:
“Rollups solves the huge problem inherent in Plasma-data availability. With rollups, all transaction data will be bundled or aggregated and available on Ethereum in a cheaper way than regular blockchain-based transactions. In addition, , All computing loads are done off-chain, which greatly improves throughput and transaction cost efficiency.”
Cartesi plans to release its own optimistic rollups on its test network in early 2021. This release will come with a Linux-based infrastructure, effectively providing a scalable version of Ethereum to developers who are accustomed to mainstream standards.
Ethereum 2.0, the first step towards a scalable ecosystem
It is worth pointing out that the arrival of Ethereum 2.0 will not negate the development of the second-tier platform that is currently trying to solve scalability. On the contrary, once sharding is fully implemented, technologies such as rollups or side chains will continue to help Ethereum 2.0 expand beyond the latest throughput.
So fasten your seat belt, sit down, and start a long journey. Ethereum 2.0 may be preparing for its first launch, but it is still only the first of many steps on the long road to scalability. The continued development of second-tier solutions means that there will be many companies along the way.
