Ethereum 2.0 Newsletter — Constantinople Hard Fork Update
In this edition of our newsletter, we will be exploring the progress of Ethereum and what is in store for the future of Ethereum 2.0! With all the hype surrounding this new age of Ethereum, WeTrust wants to provide readers a glimpse of what the development teams are working on. In the upcoming weeks, we will have some exciting partnerships and challenges with some of the Ethereum 2.0 development teams!
Constantinople Hard Fork
Some people didn’t believe it would happen and it would be delayed again. Some markets were created, such as the one below.
But fortunately, it finally happened! Block number 7,280,000 happened (after three tries..)
What is in store for this Fork? What does it mean for Ethereum?
Here are the 4 major changes that happened during this fork.
EIP 145 — Native bitwise shifting as a more efficient method of information processing
By implementing native bitwise shifting, EIP 145 will speed up the arithmetic on the Ethereum network, and make certain operations cost less gas. This improvement is estimated to be 10-fold in terms of gas cost. This will help make it cheaper to run certain smart contracts on Ethereum. Remember how expensive it was to play Cryptokitties?
EIP 1014 — Providing a scaling solution by introducing state channels to the Ethereum Network
Similar to the Bitcoin lightning network, state channels are designed to allow transactions to take place “off-chain”. With transactions taking place off the main chain, this should begin the transition to scaling solutions. This will eventually allow us to take many transactions outside of the main network and combine them into one. Overall, this increases transaction throughput on the main chain by moving many of the transactions off the main chain.
EIP 1052 — Optimization efficiency of executions and computing time for smart contracts
Many contracts need to perform checks on a contract’s bytecode, but do not necessarily need the bytecode itself. This EIP 1052 will make it so that the hash, or just the digital footprint, is checked. This makes smart contracts much faster to process!
EIP 1234 — Reduce block mining rewards from 3 ETH to 2 ETH, and delay the “Difficulty Bomb” for 12 months
One of the biggest changes to the Ethereum network, EIP 1234 will delay the “Difficulty Bomb” for a year in order to give time for the switch from proof of work over to proof of stake. The difficulty bomb, as shown in the picture below, is the mechanism of exponentially making it more and more difficult to mine Ethereum (to the point where no one will mine it). This “bomb” is to make miners adopt new updates, and prevent the situation that happened with Ethereum Classic’s Fork.
At the same time, the block mining rewards are being reduced from 3 to 2 ETH, a reduction of 33% rewards for miners! With less supply, naturally the price will go up… (right?) At least, that is what was expected prior to the fork. We will follow the effects of the mining reward reductions on the price of Etheruem and follow up in next week’s newsletter.
What does this all mean for Ethereum?
Ethereum is undergoing a huge movement towards what we call “Ethereum 2.0”. This fork brings some much needed changes to lower gas costs, improve transactions, and prepare for the upcoming switch to proof of stake.
There are 8 organizations that are currently working on Ethereum 2.0. Those are Chainsafe, Pegasys, Harmony, Parity Technologies, Prysmatic Labs, Sigma Prime, Status and Trinity. Over the next few weeks, we will be giving updates on what these organizations are doing to build the future of Ethereum.