Stake like never before – Ethereum 2 contract blown up

A contract packed The year 2022 promises to be colorful for the Ethereum network. Thus, it should witness the most important update in its history with the passage to Proof of Stake. As the deadline approaches, more and more validators are flocking to the beacon chain of Ethereum 2.0.

Ethereum 2.0: imminent launch

Ethereum has been a victim of its success for several months now. Indeed, the network is witnessing a growing number of users leading to an increase in the number of daily transactions. However, it is not able to correctly process all of these transactions.

As a result, transaction fees have exploded, making the network almost inaccessible to most users.

In order to overcome this problem, the developers have been studying and developing for several years the change of consensus to make the network go from Proof of Work (PoW) at Proof of Stake (PoS). This new PoS-based network is commonly referred to as Ethereum 2.0.

With this change in consensus, the current network validators, in other words the miners, will be replaced by validator nodes.

So, in December 2020, the backbone of Ethereum 2.0 was launched with the deployment of the beacon chain. As a reminder, this ensures the consensus layer of the network and evolves in parallel with Ethereum as we know it.

In 2022, the application layer of Ethereum is expected to be connected to the consensus layer of Ethereum 2.0 through a mechanism called The merge. Therefore, the transition to Proof of Stake should be assured during the first quarter of 2022.

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Validators flock to ETH 2

With The Merge’s fateful application date approaching, more and more validators are flocking to Ethereum 2.0.

Thus, the number of ETHs that are blocked in the Ethereum 2.0 deposit contract has just passed the bar of 8 million ETH.

Announcement of the passage of 8M ETH by Glassnode – Source: Twitter.

As a reminder, the deposit contract is a smart contract hosted on Ethereum. This allows ETH to be blocked on Ethereum 1.0 in order to issue the tokens on Ethereum 2.0 necessary to operate a validation node. Indeed, as part of the Proof of Stake, validators must back up collateral of 32 ETH to their node to participate in the validation process.

Thus, the more than 8 million ETH deposited in this contract will be blocked there until the launch of Ethereum 2.0. The terms and conditions for recovering the tokens have not yet been set. It’s not yet clear whether these will be redeemable during The Merge or later.

On December 20, The Merge’s first community testnet was launched by the developers of Ethereum. This allows the community to test the passage to Proof of Stake and to report any bugs still present in the source code. Its good progress will be decisive as to the date of deployment of The Merge on the Ethereum mainnet.

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