Understanding Ethereum 2.0 and why it matters

Ethereum is a popular public and open-source blockchain-based distributed ledger for the efficient smart contract functionality that facilitates the building of blockchain applications and assists in maintaining reliability in the trustless environment. Ethereum 2.0 is the latest and major update in the ethereum public main net. The main aim of this development is to improve the performance. The ethereum protocol was launched in 2015 and proved to be an incredible success. Ethereum 2.0 is a planned upgrade that will allow thousands of transactions within a second. While people are talking about the soaring prices of bitcoin, ethereum was upgrading to the better version as ethereum 2.0. Ethereum is the second largest crypto in the world.

Due to these developments and increasing reliability people are more willing to invest in ethereum 2.0. There is a significant spike in the investments in ethereum 2.0, especially in Nigeria. If you have still not invested and are wondering how to buy ethereum in nigeria because you do not have any knowledge regarding trading. Then you are thinking wrong. You just need to choose a good trading platform that charges a low transaction fee and is very efficient in terms of speed and a user-friendly website. Finding a good crypto platform will not take much of your time and energy. Google down a few crypto trading apps and go through their websites for once. Just read their terms and conditions before creating an account with the chosen app.

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A peer-to-peer platform is more popular among investors due to its various features including the lower price on the platform when compared to the current market price. However, one such platform is Vertex Market. It is a very dedicated crypto trading platform. It is a type of paper-to-peer platform which consists of a large number of buyers and sellers. Moreover, the platform facilitates convenient trading in your currency. It offers a wide number of payment options like Paytm, Phone Pay, Google Pay, credit card, local banks wire, and many more to enable their users hassle free trading experience.

There are platforms that offer investing in different cryptos at your proffered price. Not only ethereum but you can buy any cryptocurrency in your local currency bitcoin to naira is one such example. 

Why does Ethereum 2.0 matter?

The smart contract and decentralized applications elaborate on how real-world smart contract obligation is programmed and executed on the part of the blockchain. Ethereum 2.0 is also known as serenity. It aims to boost the speed, scalability, and efficiency of the ethereum network. Ethereum 2.0 possesses some fundamental changes in terms of structure and design. There are two major changes namely, sharding and proof of stake.

The major objective of the recent upgrade is to achieve the following objectives-

  • It aims at extending the scalability of ethereum networks.
  • It enhances the efficiency of blockchain technology.
  • It improves the speed of ethereum blockchain.
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What is sharding?

It is the process of breaking one whole blockchain into multiple different blockchains known as shards. It enhances the network efficiently as single validators do not need to further handle the workload alone. But each and every validator needs to maintain and record the information about their shards. Validators also shuffled between shards at regular intervals to avoid manipulations. Moreover, the beacon chain is adopted for coordination and effective communication of shards.

What is proof of stake?

In this, instead of miners, there are validators. Their main role is to propose building new blocks, facilitating better computing power, bandwidth, and storage to validate transactions. These validators are offered periodic payouts. Also, the deposit contract of 32ETH is locked by these validators. In simple words, they are a kind of security deposit that is forfeited partially or fully in case of any malpractice. The method has proven to be effective and efficient in curbing malpractices.

Working of ethereum-

The vital and the most important aspect of ethereum 2.0 is the validators. They are completely responsible for the maintenance and infrastructure. The validators possess two keys: a withdrawal key and the signing key. The signing key is utilized to function work for the blockchain. Basically, there are three main types of validators.

  • For proposing and adding blocks to the beacon chain.
  • To attest to the validation of shard chain and beacon chain.
  • To report the malpractice by any other validators.
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However, to facilitate such features, the signing key stays online for 24 hours during the day. Moreover, the withdrawal key functions for funds action. Hence the online presence of the withdrawal key is not important throughout the day.

Difference between ethereum and ethereum 2.0

The main difference between them is the consensus mechanism. Etheruem works on proof of work while ethereum 2.0 works on proof of stake. 

The proof of stake is the kind of energy-intensive process where mathematical puzzles are decoded by miners through computer hardware. However, it is also used to verify new customers also.

Is Ethereum 2.0 more secure?

The major advantage of ethereum 2.0 over ethereum is its scalability. Since ethereum 2.0 works on shadowing to which it can carry over 10,000 transactions in a second. Traditionally, ethereum can only carry 30 transactions in a second. You can imagine the difference in scalability. Moreover, ethereum 2.0 is considered safer than ethereum. Ethereum 2.0 needs a huge set of validators that is around 16384, however, this makes them more secure, decentralized, and less prone to manipulation.

What is the future of ethereum 2.0?

Ethereum is the largest blockchain for general purposes in today’s market. There are few more developments that are still to be built and implemented to make this crypto more powerful. Ethereum is anticipated to see more interest from investors in the coming years.

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