Ethereum 2.0 Set to Make Waves in 2020-2021

In Industry News

Ethereum (ETH) recently celebrated five years since its launch in 2015, and it’s impossible to discount how much of an impact the project has had on the blockchain landscape since its inception. Led by the talismanic figure of Vitalik Buterin, Ethereum popularized innovative blockchain features such as smart contracts, in addition to empowering a robust ecosystem supporting decentralized apps, markets and operating systems. That’s not to mention claiming and holding the #2 market cap position in the cryptocurrency charts - and even threatening to upset Bitcoin from time to time.

Ethereum development

Since the explosion of blockchain & cryptocurrency onto the global financial scene, Ethereum has, despite its promise, been grouped with the majority of blockchain projects whose ambition exceeded the development status of its technology. Obstacles faced are almost universal: network speed, scalability and security. The ETH team has long been laboring on bringing the technology of the project to where it needs to be - signified by the name Ethereum 2.0.

ETH 2.0 will usher in a number of dramatic changes to Ethereum, with the stated goals of simplifying the blockchain, improving network performance, increasing security and reducing barriers to entry. Future-proofing for quantum security is on the cards as well, with a three-phase plan that also includes sharding, a bleeding-edge solution for blockchain scalability.

Proof-of-Stake Shift

One of the more controversial changes the ETH project will be adapting is a shift from Proof-of-Work (PoW) to Proof-of-Stake (PoS). PoW is how BTC and its successors were initially designed - “mining” coins by leveraging computing power across the network to add transaction blocks to the chain. Recently, PoW has come under scrutiny for a variety of perceived flaws, including inefficiency, excess power consumption, and centralization of mining resources. PoS, on the other hand, allows users to “stake” tokens they hold, in order to gain the ability to validate transactions and earn rewards.

The shift in consensus algorithm is incredibly ambitious for a project in operation for so long, but regardless of whether it will solve concerns of centralization and energy efficiency, it is one of many leaps forward in the ETH 2.0 blueprint, which is intended to begin with Phase 0 in 2020, continuing to Phase 1+ in 2021 and beyond. This means that we currently stand in the last days of ETH 1.0 - an opportunity that many traders and investors are eyeing as the price of ETH rocketed from $230 to nearly $400 in early August.

DeFi movement

Another big part of the buzz surrounding Ethereum of late is what’s called the “DeFi movement” - meaning decentralized finance. DeFi put simply, is the evolution of traditional financial services, into a decentralized, blockchain-based form using smart contracts - and Ethereum is a leader in this area. While DeFi isn’t brand new, the movement is gaining more and more notice as the number of services available as well as the number of users are growing dramatically. A whole range of assets and financial products are being tokenized and made available on smart contracts powered by ETH, providing new opportunities for users and providers alike.

It’s safe to say that all eyes are on ETH as we move deeper into Q3 of 2020. For those who fancy increasing their ETH stack as the market looks increasingly bullish, it’s never been easier or faster to buy cryptocurrency than with Liquid Buy & Swap, which allows users to buy ETH instantly using a Visa card from anywhere globally.

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