The Ethereum network has finally launched a scalability and security update. The test version of the much-anticipated project Ethereum 2.0 went live on December 1st at noon UTC with a presentation of Beacon chain genesis block. CEX.IO supports the Ethereum upgrade and is preparing to take all the necessary steps to update our systems.
ℹ️ About Ethereum 2.0 and Beacon Chain
Ethereum 2.0, also known as “Serenity”, is an upgrade to the Ethereum blockchain. It aims to improve the speed, efficiency, and scalability of the network. In fact, Ethereum 2.0 will be a completely new blockchain with the support of a proof-of-stake mechanism. However, these complex changes will be implemented in separate phases over a long period of time.
The first one, known as Phase 0, launched on December 1, 2020, with the introduction of the beacon chain. According to the team behind Ethereum, the Beacon Chain will present a Proof-of-Stake (PoS) consensus to the Ethereum blockchain to address some of the scalability issues. Beacon chain should further become a new Ethereum. At this stage, it does not support smart contracts, sharding, or a new virtual machine yet. The current version of Ethereum 2.0 is for testing staking features only.
🤔 The main difference between Ethereum and Ethereum 2.0
Previously, all transactions in the Ethereum blockchain were validated through the Proof-of-Work (PoW) mechanism. In PoW, miners use the computer processing power to solve complex math algorithms and add new transactions into blocks.
Ethereum 2.0 will use PoS consensus, where validators can simply stake crypto for the right to verify a transaction. Thus, the new project is considered more energy-efficient as it doesn’t require computer power for processing.
🙌 What does it mean for users?
The original Ethereum chain will run alongside until the complete transition to a new blockchain. No need to move your ETH funds to another blockchain, the mainnet is fully operational and processes transactions as usual. The migration to the updated network will be automatic and no additional steps required from users. Since the original chain is running in parallel, there will be no interruptions in data or transaction processing.
Once the testing of the Beacon chain is completed, you’ll be able to support the network processes by participating in staking. Moreover, you can receive crypto rewards for that. Currently, the staked tokens remain locked on the beacon chain till the launch in 2021. Since the complex upgrade is being phased in, the Ethereum mainnet will officially turn to the Proof-of-Stake model later.
Interestingly, according to Glassnode, almost 900,000 Ethereum has been staked so far, which is much more than the minimum amount required for Phase 0. This shows strong community support for Ethereum 2.0.
🔥 CEX.IO will support ETH 2.0 staking
CEX.IO plans to support the upgrade of the Ethereum network.
Our engineers are closely following the ETH2 project, which is currently in a testing phase. With the safety of your ETH holding in mind, we also want to provide you with more staking opportunities. Hence, the CEX.IO team is looking into the possibility to launch ETH2 staking. We will share more details in a separate announcement. Stay tuned for updates!
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Note: The Ethereum 2.0 staking will be available for customers in eligible jurisdictions.