Blockchain News

Ethereum Turns Six With London Hard Fork & Proof of Stake on the Horizon

The eyes of the world are upon Ethereum with one of the most anticipated forks in crypto history.

The Big Party Has Yet To Come

Ethereum celebrated an anniversary Friday, July 30. The world-changing blockchain that brought us smart chain technology and major innovations in crypto like decentralized finance and non-fungible  tokens, turns six years old. 

From the depths of Berlin in 2015, the blockchain built to change the world is on the verge of potentially its most important blockchain forks -- London Hard Fork.

As of late 2020, Ethereum has grown too big even for itself. The anticipation around crypto could not be higher for the upcoming fork. The first mentions of these changes came in 2019. 

As the confetti settles from the birthday bash, Ethereum is set to make major changes in the functionality of its blockchain. On August 4th, Ethereum will complete its hard fork and take a critical step toward an overarching scalability upgrade of the network. But while all of crypto waits with bated breath, the Ethereum team appears unphased.  

“Originally we envisioned something more like a big grant event where all the good things would happen at the same time and [Ethereum] would be a new blockchain and it would be a new protocol and people would have to take a lot of efforts to migrate over but later we've slowly changed the roadmap over to something that's much more incremental,” Vitalik Buterin, co-founder of Ethereum, told the Lex Fridman Podcast in June

The hard fork results in a new transaction validation system due to the EIP 1559 proposal that passed. The chain will utilize a proof-of-stake system, allowing for more scalability and environmentally friendly consensus.

Source
“Proof of stake happens kind of overtime, and then sharding is added over time, and all of these features get added over time. And so the experience for just a regular Ethereum user will still feel very seamless. It's maybe a little bit more complex than the hard forks that we've already done, but from a user's point of view not by that much,” Vitalik continued.


The London Fork

The updates will incorporate cutting-edge blockchain technology like sharding and move the chain from proof-of-work versus a proof-of-stake. The implications of these changes could bring a more efficient, secure, and sustainable Ethereum blockchain. 

The hard fork will integrate five immediate updates called EIPs (Ethereum Improvement Proposals). Each change aims at optimizing and improving the network. 

The most controversial and anticipated upgrade, dubbed "London," is EIP 1559. The EIP 1559 will make Ethereum less inflationary and is controversial because it will begin burning fees that previously went to miners. 

This upgrade is the central improvement in an attempt to generate greater bandwidth and reduce transaction fees on the chain and is critical to the changeover to Proof-of-Stake. 

Source
“I like proof of stake. And I've liked proof of stake for many years, basically because it just requires much less ongoing resource consumption.” Buterin explained to Fridman. And about the benefits of adding validators, Vitalik added: “This is good for a few reasons: one is the kind of environmental rationale that you're not breaking the environment. The second is that you're not taking away electricity and other resources from other people.”

The hard fork does not come without criticism. There is the issue with miners losing their fees and the questions around Miner Extractable Value (MEV) remain unanswered. 

Some argue that proof-of-stake will increase the centralization of the chain as well. Vitalik celebrates the environmental benefits of the overall transition and the preferred long-term benefits of the updates. 

He welcomes the criticisms as good problems to have and looks forward to solutions. Despite being ‘controversial’ it is still likely the most anticipated fork in crypto history.


Exciting Times Ahead

As Vitalik told Fridman on the podcast, the user will not see too many changes in how Ethereum will work––the major changes come behind the scenes. The Ethereum chain has fought hard in seeking to solve major scalability issues like congestion and latency. 

Throughout, it still holds strong as the second most important blockchain, and rightfully deserved. But if it wants to keep competing, it will need to try and catch up to the speeds and transactions of newer chains like Binance Smart Chain and Solana. 

The new updates and their incremental applications should make the next few months––and years––an exciting race for the top crypto and blockchain. 

How would you rate this article?

Related News