Ethereum spring 2019 update: ETH 2.0 is on the way

Much has been said about Ethereum 2.0 being late to the party. Will the recent news boost investors' expectations?

Late last month, the Ethereum Foundation released a brand new update detailing the company’s goals for the next 12 months.

The world computer cryptocurrency is developing a series of interesting initiatives targeting both important technical updates as well as a crucial move towards community development and engagement through the funding of projects. As mentioned in the blog post:

“We also recognise a need to take more initiative in growing the Ethereum ecosystem, on-boarding developers, and improving the developer experience.”

Recent developments

Over the past year, the Ethereum Foundation has been making strides to further implement Proof-of-Stake (PoS) through Casper, and it was revealed recently that two key members of the team, Vlad Zamfir and Vitalik Buterin, were trying different approaches.

Even though they described this as a “fun” competition, I seriously doubt both implementations will survive in the long term. Vitalik is looking to do a “softer” implementation of the upgrade (Casper FFG), where Proof-of-Work (PoW) will work in parallel to PoS in one of the shards in order to give miners more time to move towards the new consensus algorithm and to make sure the system is resilient to issues with PoS.

Vlad’s version of Casper (Casper CBC) intends to fully blow away PoW and aims to be more aggressive towards its PoS implementation.

Casper the Friendly Finality Gadget (FFG) — or “Vitalik’s Casper” — is a hybrid PoW/PoS consensus mechanism and is the immediate candidate for Ethereum’s first bridge to PoS. More specifically, FFG implements a PoS mechanism as an overlay on top of a PoW chain (such as Ethereum’s ethash PoW chain). The blockchain would grow every block with the familiar ethash PoW algorithm, but every 50 blocks is a PoS “checkpoint” where finality is assessed via a network of validators.

Casper the Friendly GHOST: Correct-by-Construction (CBC) — or “Vlad’s Casper”—differs in approach from a traditional protocol design. Firstly, the protocol is partially specified in the beginning, and secondly, the rest of the protocol is derived in a way that is proven to satisfy the desired/requisite properties (typically, a protocol is fully defined then tested to satisfy the properties). In this case, one way to derive the full protocol is to implement an estimate safety oracle (“an ideal adversary”), which either raises exceptions of a fault of a justified estimate or enumerates the potential future faulty estimates. More specifically, Vlad’s work focuses on designing protocols where you can extend local views of a node’s estimate of safety to achieve consensus.

In short, FFG focuses more on a multi-step transition to introducing PoS for the Ethereum network. This prepares the network for an iterative implementation that increases the role of PoS over time, as PoS will claim a smaller portion of the rewards to start with. On the other hand, CBC focuses on formal methods that derive safety proofs “by construction” from the first principles. Albeit confusing, the different approaches to solving this problem created two distinct work streams that complement each other well. The final form of Casper will likely draw from both FFG and CBC.

Community-engaged philosophy

EF: A Philosophy of Subtraction

The Ethereum Foundation is also engaging with other projects that live in the Ethereum ecosystem to further develop and implement ETH 2.0.

By helping projects grow through funding or business support, Ethereum is betting heavily on a community of projects that can evolve to become key players in the cryptocurrency space. As the Foundation mentions in its update:

“ETH 2.0 is a name given to a set of transformative upgrades for the Ethereum protocol. Last year, this effort moved from a research project to an engineering effort. Client teams supported by the Foundation including Nimbus, Prysm, Sigma Prime, and Substrate Shasper are among those working to turn ETH 2.0 into a reality.”

Of course, to achieve this dream, there has been ongoing support through the ETH 1.0 initiative, which focuses on improving Ethereum’s short-term scalability and sustainability with an eye to easing the transition to ETH 2.0. Work continues on essential projects like Geth and Solidity as well, and regular updates from all teams involved are provided.

To build the new ecosystem with ease, Ethereum has been investing in hackathons to bring together the best and brightest developers. It has also been hosting research workshops – such as at Stanford and MIT – through which dozens of talented mathematicians, computer scientists, and economists were introduced to research problems originating in Ethereum. Many have continued working on these problems leading to progress in areas essential to the future of Ethereum, including Casper CBC, VDFs, Plasma constructions, succinct zero-knowledge proof-based systems, liveness, and safety bounds for Ethereum 2.0.

“ETHGlobal hosts Ethereum hackathons around the world, focused on on-boarding new developers into the ecosystem and facilitating project and company creation. At a recent event, ETHCapeTown, 70% of attendees were from South Africa and 40% of attendees were new to Ethereum.”

Simply put, the Ethereum Foundation is working with prominent organisations to encourage their engagement with the Ethereum ecosystem.

$30 million going to Ethereum-based projects

Over the next year, the Ethereum Foundation plans to spend $30 million on key projects across the ecosystem. This budget is insulated against downward ETH price movement.

As stated in the blog post:

“We believe that this is a critical time for Ethereum, justifying significant investments in important work across the ecosystem. Allocating across such a large and vibrant ecosystem is a substantial optimisation challenge. We are constantly re-evaluating and optimising our decisions, and new opportunities for leverage appear every day.”

By extending resource allocation to projects outside the Foundation, Ethereum will be boosting its community of projects that want to make a serious impact on all sorts of industries.

That seems to be a smart move, as protocols can only grow with the projects they support.

 

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