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What is Ethereum 2.0 and Why You Should Take Notice

What is Ethereum 2.0 and Why You Should Take Notice

Blockchain has changed the way the world functions. It has touched upon most sectors such as banking, healthcare, and fintech. Cryptocurrency (or digital currency), based on blockchain principles, has made transactions easy and secure. Among the many cryptocurrencies currently existent, Ethereum is the second-largest today -- the first being Bitcoin. Ethereum was launched in 2015, and since then, over 1,400 Ethereum projects are under development.

The Value of an ethereum to inr is ~Rs. 1.8 lakhs.

What is Ethereum 2.0?

Ethereum 2.0 (also known as Eth2) is simply an upgrade to the existing version of the Ethereum blockchain. The purpose of Ethereum 2.0 is to solve the bottlenecks that are prevalent with the existing version and enhance the scale and speed of transactions in the Ethereum network.

 Several features differentiate Ethereum 2.0 from Ethereum, the main aspects being the structure and design. Ethereum 2.0 has the key elements of "proof of stake" and "sharding."

 Let us look at the features of Ethereum 2.0 in detail:

 1.         Proof of Stake: Ethereum uses a consensus mechanism, which differs between the two versions. While Ethereum utilizes proof of work or PoW, Ethereum 2.0 employs the proof of stake (PoS) system. The PoW system involves high energy and complex math puzzles to verify new transactions. Anyone (miners) who manages to solve the puzzle first manages to add a transaction that comprises any past transactional records that make the blockchain.

In the PoS system, however, transactions are verified by using algorithms via validators and not miners. The block is added to the blockchain once the majority of validators have acknowledged the block. PoS thus reduces the complexity of the process drastically.

 2.         Sharding: Another feature that enhances Ethereum's efficiency in the upgraded version is a processing mechanism called sharding. While in the earlier version, any data added to the blockchain needs to be verified by all nodes participating, which significantly reduces the processing speed, creates bottlenecks and raises transaction costs, sharding solves these problems. Sharding allows breaking the tasks of verifying data into smaller sets of nodes, and nodes only verify the data they have received. Not every node is required to verify the data, which results in a rise in overall capacity by many times.

 3.   Scalability: Ethereum 2.0 can perform up to 10,000 transactions/ second compared to the earlier version that supports only 30 transactions/second. This solves the problem of bottlenecks and greatly enhances transaction speed. This results in better efficiency and quicker transactions.

 4.   More secure: Ethereum also adds more security in its upgrade of Ethereum 2.0. While most PoS networks require a few validators, resulting in decreased network security, Ethereum 2.0 needs a large set of validators, making it more decentralised and safer.

5.   More sustainable: The Proof of Work (PoW) mechanism uses less computing power to secure a blockchain. Thus, the technology used in validating Ethereum 2.0 transactions requires less power, and hence, less energy. This is good for the environment.

 Hence, Ethereum 2.0 is a faster, safer, and better version of the existing Ethereum blockchain.

Ethereum serves as a decentralised platform and a programming language used to develop decentralised apps. These apps primarily allow users to make payments and enter agreements without the need for a third party.

Further, there is rising use of blockchain technology to enable online payments, loans, and trading securely. With its added advantages and scalability, Ethereum 2.0 is expected to garner increasing attention among investors in the near future owing to its many applications beyond cryptocurrency.

Do you know Ethereum delivered more than 35% returns in March 2021 alone?

If you are considering investing, here's how you can invest in Ethereum in India.

 Simply visit Head over to the instant coin converter with two dropdowns. Once you select "INR" from the dropdown list and ETH in the right dropdown list, you can see all offers from exchanges for ETH to INR conversion when you click on "View all Offers."

 You can choose the recommended exchange and buy ETH using INR at the best rate. Next, select your wallet address to get ETH. Once that is done, simply make the payment in INR and share your personal details for KYC verification. You will receive your ETH as soon as your KYC details are verified.

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