This article will delve into the Altair update completed on Wednesday and how it lays the foundation for the merger, which may be the largest Ethereum upgrade to date . The article will discuss the impact of these upgrades on the Ethereum blockchain and assets such as Ethereum. In general, these improvements are part of a larger set of systemic changes. The goal is to make Ethereum more scalable, environmentally friendly, and safer, while enabling Ethereum and its support in the process. Those who benefit.
Altair’s upgrade has just been carried out around 11 a.m. (UTC) on October 27, 2021. Ordinary users of Ethereum may not have noticed any difference in this upgrade, because it does not affect the blockchain where the application is hosted, but the Beacon chain is the real impact. This upgrade enhances the decentralization and security properties of the beacon chain.
Looking back at the content described in the first part of this series, the Beacon chain is the proof-of-stake blockchain of Ethereum. Since December 2021, it has been running in parallel with the proof-of-work blockchain. Currently, the Beacon chain only deals with staking rewards, and there is no protocol running on it to ensure that the network works as expected. The launch of the Beacon chain was largely successful, with an uptime of 100%, and the amount of Ethereum pledged exceeded 8 million.
This means that more than 33 billion U.S. dollars worth of Ethereum is pledged, and these Ethereum accounts for 6.8% of the total circulation. Ethereum reached this milestone with more than 50,000 validators depositing directly into the pledge contract.
Altair’s upgrade is the first upgrade of the Beacon chain, and it may be the only one before it merges with the Proof of Work (PoW) chain. Among them, Altair has implemented two major improvements: support for “light clients” and update measures to deal with inactive nodes and bad actors.
Under the previous system framework, only complete nodes can run on the Beacon chain, which prevents people who use low-configuration GPUs or devices with low memory capacity from participating. After the Altair upgrade, these “light clients” can run on low-profile machines, making it easier for anyone to verify transactions that occur on the Beacon chain. The “light client” uses complete nodes in a way of minimizing trust to ensure that the blockchain can be verified in a decentralized manner.
In addition, Altair has changed the penalties for inactive nodes and bad actors in order to improve the security of the network. Nodes that are completely inactive will now lose up to 15% of their balance, which is higher than Altair’s previous 12%, further suppressing inactive behavior. Likewise, the parameters used to combat bad actors are now tougher. The minimum penalty amount has been doubled to 0.5 ETH . For every bad behavior, nodes that violate consensus will face a risk of 1/64 (compared to 1/128 before). The severity of the penalty mechanism is now also affected by twice the proportion of validators based on the reduction. In other words, if 10% of validators have bad behavior, the corresponding punishment will be 20%. Ultimately, this punishes bad actors to a greater extent, and if a high percentage of validators try to attack the network, the punishment will be even greater. Since validators are directly related to network security issues, the blockchain system should encourage them to act in the best interests of the blockchain to avoid economic losses (the rational man principle) and be compensated.
Finally, Altair is also a way to ensure that the Beacon chain can be upgraded smoothly. With these improvements, as well as some minor bug fixes, Altair is preparing for the biggest and most anticipated update of Ethereum.
Merger and sublimation
Since 2014, Vitalik has proposed the transition from Ethereum to proof of equity. This will not only reduce the resource consumption of the network to almost negligible, but also effectively improve the security and scalability of Ethereum. The so-called merger will realize this vision by migrating applications running on the current proof-of-work blockchain to an executable version of the Beacon chain.
The merger has been successfully tested for the first time at the Amphora seminar, and observations and experiments will continue in the coming months. According to the recent Ethereum core developer meeting, the deployment and merger will be completed in March 2022, and if it is more secure, the merger will be carried out in the second quarter of the same year.
The implementation of the merger will not only affect applications running on Ethereum, but also benefit Ethereum holders. The merger was achieved by simultaneously reducing the issuance of Ethereum and increasing the rewards for staking users. At present, the supply of Ethereum is increasing by about 2% every year, and the circulating supply is about 118 million ETH.
After the merger, the issuance of ETH is expected to fall by 90%, with a peak supply of approximately 120 million, and then a slow decline thereafter. This is again linked to EIP-1559, which introduces basefee, which can effectively remove excess ETH from circulation with the increasing use of the Ethereum blockchain. ETH will enter deflation and is expected to cause price increases because its supply will decrease as demand increases.
In addition, since Ethereum will no longer rely on miners, the remaining unburned transaction fees will go to the validators participating in the Ethereum pledge. It is expected that this will promote a higher rate of return on pledged APY. These returns vary based on the amount of ETH pledged, the fees being processed, and the percentage of these fees being burned. According to forecasts, after the merger, the pledge reward may double from the current 5% to 10% to 12%.
These predictions are based on the growth of three key parameters in the past 7 days, 30 days, and 90 days, using calculations by Ethereum Foundation researcher Justin Drake.
A higher rate of return on pledged APY is not only good for the verifier, but also improves the security of the network. This is because a higher rate of return will incentivize more people to participate in the ETH pledge, and more value being pledged makes it more costly for anyone to try to attack the network, because they need a larger holding. To influence the entire consensus. In addition, the increased penalties through the Altair upgrade will result in massive economic losses if the perpetrator violates the best interests of the network. In the end, this has once again improved the security of Ethereum, while maintaining the interests of network participants.
Ethereum is a constantly evolving infrastructure for decentralized applications. With the demand for countless use cases, Ethereum has envisioned a path to a more secure, scalable, and environmentally friendly network. Through Altair’s upgrade, the proof-of-work chain and the beacon chain are about to merge, which also laid the foundation for Ethereum’s vision. Finally, these are expected to benefit ETH holders while providing higher returns for validators.
Many people may have noticed that one thing not mentioned in this article is the scalability part. Because this is not in line with the Ethereum 2.0 upgrade theme discussed, it is currently being resolved by the second layer of solutions. The second-tier expansion platforms, such as Arbitrum and Starkware, have reached a total value lock-in of more than 4 billion U.S. dollars, while reducing Ethereum transaction fees by 90% and increasing throughput. Sharding is the last piece of the puzzle of Ethereum 2.0. By implementing multiple interconnected chains, scalability is increased by 100 times. Currently, sharding is expected to be launched at the end of 2022 or early 2023.
Posted by:CoinYuppie，Reprinted with attribution to:https://coinyuppie.com/in-depth-exploration-of-ethereum-altair-merger-and-sublimation/
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