The 25-day countdown to the launch of Ethereum 2.0, will the beacon chain be delayed again?

The Ethereum 2.0 upgrade is a high-profile industry event in the blockchain industry in 2020. According to the latest news, version 1.0 of the Ethereum 2.0 specification has been released, and if everything goes according to plan, the Ethereum blockchain 2.0 upgrade will take place in early December.

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Release of deposit contract

On the evening of November 4th, according to a blog report by the Ethereum Foundation, the ETH2.0 technical specification v1.0 was officially released, and the deposit contract of the main network was released at the same time. The contract address is: 0x00000000219ab540356cBB839Cbe05303d7705Fa.

It states in the article that users can register in LaunchPad as an Ethereum 2.0 validator (a person who stakes ETH on the network) and a main Ethereum contract address (where funds will be deposited). If users want to run their own verification program on Ethereum 2.0, they need to ensure that they have the necessary hardware requirements, technical expertise, and use Ethereum officialLaunchPadFollow the step-by-step instructions.

However, ConsenSys reminded users on Twitter that funds should not be sent directly to the deposit contract, but should be staked using the staking mechanism (via Launchpad).

"Remember: do not send ETH to the deposit contract! Sending ETH to this contract address will result in a failed transaction and does not mean you are staked on ETH2.The release and activation of the deposit contract of Ethereum 2.0 means that the phase 0 of Ethereum 2.0 is about to officially start. According to the official news released by the Ethereum Foundation, the creation time of Ethereum 2.0 is set at a block height greater than 1,606,824,000, which is around 12 noon on December 1, UTC time.

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The role of stage 0 initiation

Affected by this news, the price of Ethereum soared from $383, breaking through the $400 mark again, with an increase of 5%.

Ethereum 2.0 will be divided into at least 3 phases, namely Phase 0, Phase 1, and Phase 2. Phase 0, as the core of Ethereum 2.0, will launch the "Beacon Chain" as a random number generator for the entire 2.0 network. After the first and second phases, functions such as sharding and smart contracts will be gradually enabled, and validators will provide transaction verification services for the corresponding shards according to the random allocation of the beacon chain.

At the same time, Phase 0 will make the Ethereum blockchain officially switch to the PoS consensus mechanism, and transactions will be verified by those who hold a large amount of ETH. Ethereum 2.0 allows ETH holders to participate in running the network instead of Proof of Work as it is now.

It's worth noting that Phase 0 won't have any actual functionality. After going live around December, all the Phase 0 ETH 2.0 blockchain can do is verify blocks. Tim Ogilvie, CEO of Staked, a company that handles servers and infrastructure on behalf of stakers, said, “None of the core functions of Ethereum that you think of as part of phase 0, you can’t do ETH transfers, Cannot participate in DeFi or other smart contract activities.”

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Will Ethereum 2.0 be delayed again?

For Ethereum, there have been many challenges in the past period. The 2.0 upgrade is not so smooth, it can even be said to be difficult.

First of all, DeFi (decentralized finance) has brought a burden on Ethereum. This year, the DeFi boom continued for a fiery summer, and users invested billions of dollars in DeFi financial products. This boom led to a surge in activity on the Ethereum network, and the usability of the Ethereum network was greatly tested. At that time, people will shift their hopes to the upgrade of ETH2.0, hoping that it can greatly increase the throughput as promised. Subsequently, the usage of the Ethereum network continued to decline due to the decline in DeFi popularity.

Second, there is the need to constantly resolve issues that arise on the test network. According to Ogilvy, there may have been hundreds or thousands of bugs in Ethereum’s various testnets over the past year or so. Even if the development testers wipe out these bugs, there are likely to be many other bugs, most of which are likely to be minor. "Maybe only when real tokens are used on a real network will more serious problems be discovered."

Regarding the question of whether Phase 0 will be delayed again, Richard Ma (Richard Ma), CEO of blockchain insurance company Quantstamp, said that there are now many testnets, including two dedicated to testing the creation of the beacon chain. There is a testnet created for blocks, and there are also many bounties paid to users who find problems with the client. "At this point, there won't be too many problems."

The key to delay is whether users are willing to act as validators of Ethereum. If the pledged funds had not reached $200 million worth of ETH, this grand network upgrade would not have started. The problem, Ogilvie said, could be that ETH 2.0 clients offer low yields on staking compared to newer ETH 1.0-based DeFi protocols. Moreover, it will take a long time for the staker to withdraw the staked ETH from the ETH2.0 client.

However, he believes that "the smartest funds may wait and see for a while to find out what ETH2.0 looks like. Even if funds are short, loyal users of ETH and the Ethereum Foundation will provide financial support for the project."

So far, nearly 19,000 ETH have been deposited into the ETH2.0 contract address, reaching 3.6% of the funds required to start the network. Users can check how far away Phase 0 is from starting in depositcontract.eth (Ethereum deposit contract), and can also query the amount and value of ETH pledged in the contract on Etherscan.

Brantly Millegan, director of operations at Ethereum Name Service, said that ETH2.0 is just a "piece of the puzzle" to solve the bottleneck problem of Ethereum. Other scaling solutions such as Layer 2 protocols, sidechains, etc. can all play a role.

In any case, even if Phase 0 won’t be of much utility, it’s a momentum shift to celebrate for Ethereum investors, and possibly good news for ETH price as well.