Ethereum is the second most popular cryptocurrency in the world, which is known for its technological upgrades and active community. The last year closed on an optimistic note as Casperlabs announced “Highway”, which is their first correct-by-construction (CBC) Casper Proof of Stake implementation that is live and safe, as proved. Casper has been under development since 2014, which represents a radical change in the Ethereum Consensus Networking Mechanism. The upgrade is the amalgamation of two research projects- Casper the Friendly Finality Gadget, also called FFG, and Casper, the Friendly Ghost: Correct by Construction (CBC), which we have mentioned above. This former project is led by Vitalik Buterin and the latter by Vlad Zamfir, respectively.
Casper is the technical implementation that will eventually convert Ethereum from Proof of Work (PoW) to Proof of Stake (PoS) blockchain, also known as Etherum 2.0. Even if Ethereum was created as a Proof of Work crypto, the developers have been planning for long about transitioning to the Proof of Stake (PoS). After this upgrade, mining would no longer be a part of the Ethereum network.
Both the CBC and the FFG versions are critical for the Ethereum community. Notably, the FFG is the one being planned to initiate the Ethereum 2.0 rollout. But even CBC is important. As of now, Casper has been developed for Ethereum, but later on, it might be
implemented or adopted by other networks.
The transition from Ethereum 1.0 to Ethereum 2.0 is known as “Serenity”, which consists of three different phases. (Ethereum Casper Roadmap) Ethereum Casper Sharding was a trailer of what is going to happen after the mainnet Casper implementation.
The first phase,i.e, Phase 0, is known as Beacon Chain, wherein the Casper FFG rules would drive the Consensus Mechanism of this new PoS-based blockchain. The Casper upgrade will completely remove the mining process, where running expensive machines would incur high electricity costs. In this process, the verification and validation of new transaction blocks will be performed by block validators, who will be selected as per their stake.
This means that the voting power of each staker or validator would be determined by the amount of ether they put at stake. For instance, a person who has deposited 100 ETH will have double the voting weight as compared to someone who deposited the minimum staking amount. 32 ETH is the minimum stake amount a voter can stake in order to become a block validator in the first phase of Serenity. If everything gets going flawlessly, the random committees of validators would be selected to propose new blocks, for which they will receive block rewards eventually. The rewards are likely to comprise of only transaction fees, as there won’t be any block subsidy. The Casper model is under development, as many details are yet to be defined, mostly discussion of the possibilities of 51% attacks.
As Ethereum shifts into the Proof of Stake model, it will be totally environmentally-friendly as there are no electricity costs. When a full PoS model is implemented into Ethereum, there won’t be any need for the miners. Another advantage of this PoS transition process is security. Casper is going to act as a bookkeeper of the Ethereum 2.0 ledger, as it will be used as a selector held responsible for ordering the chain of blocks. If a validator acts maliciously, immediate actions will be taken against them, and they will be removed. The penalty for the validator will be comprising his stake, which means the network transgressions will be very expensive.
The major limitation is the Ethereum Casper timeline getting pushed over and over again as every time something or the other comes up. Currently, security and efficiency are not totally proven. As per the current codes, it is not entirely prone to 51% attacks.
CoinSwitch.co is the world’s largest cryptocurrency exchange aggregator which supports 300+ coins and over 45,000+ pairs. It provides an easier way of trading through global exchanges like Binance, KuCoin, IDEX, Huobi, Ethfinex, HitBTC and Cryptopia without creating an account on them. If you are interested in buying cryptos, do give it a try!
Reference: Binance Academy
2019-12-26 07:42:06.559096 | 2 min
2019-05-20 16:28:27.371444 | 2 min