Bitcoin: Ethereum wants to outperform its competitors with a mega update


The originally scheduled June update date could not be met, Ethereum chief developer Tim Beiko wrote in April on the short message service Twitter. “We don’t have a fixed date yet, but we are definitely on the home stretch.” He has yet to respond to a query from Reuters regarding the current status.

“The delays in the much-anticipated move to proof-of-stake are understandable given their complexity,” said Brendan Playford, founder of crypto-focused financial services firm Masa. “Furthermore, it’s still unclear whether it can deliver the promised cost reductions and higher transaction speeds.”

“Proof of Stake” instead of “Proof of Work”

Until now, transactions have been validated using “Proof-of-Work”, as with the oldest and most important cyber-currency Bitcoin. Users provide computing power to verify the authenticity of transactions and enter them in encrypted form into a common database – the blockchain. In this competition, however, only the “digger” who is the first to calculate the corresponding algorithms receives digital coins of the respective cryptocurrency as a reward. Everyone else receives nothing and their use of computing power has been in vain. Due to this high energy requirement, which would match that of a small country, cryptocurrencies have been criticized as alleged climate killers.

As part of the “Ethereum 2.0” project, the “Proof-of-Stake” procedure will in the future give the user the exclusive right to validate and encrypt a transaction that can prove the largest stock of Ethereum digital coins to some time. . As a result, only one computer is busy with an order instead of a hundred or a million. Some other cryptocurrencies such as Solana or Cardano already use this method exclusively or partially.

In addition to saving energy, developers expect the change to result in a huge speedup of processes, from the current 30 transactions to 100,000 transactions per second. The speed increase is necessary because Ethereum is not just a digital currency, but a software platform. It can be used to program automated payment processes subject to certain conditions. Additionally, more and more digital objects are registered as non-fungible tokens (NFTs) on the Ethereum blockchain. NFTs identify a digital image, video or piece of music as original and make it interesting for collectors.

“Flippening” in sight – Ethereum set to overtake Bitcoin

The technical improvements will significantly increase Ethereum’s attractiveness, optimists hope. “We’re already seeing funds moving funds to Ethereum in preparation for the ‘merger,’ although it’s not yet clear when the update will arrive,” said Noelle Acheson, chief analyst at Genesis, the e-broker. cryptocurrency. Apparently they considered Ethereum undervalued.

Some Ethereum enthusiasts already see the so-called “Flippening” approaching. With this, they mark the moment when Ethereum pushes Bitcoin from the throne in terms of market capitalization. So far, the prime crypto has been valued on the exchange at around $733 billion, about twice as much as Ethereum. However, Genesis expert Acheson is skeptical about the possibility of a “reversal”. “It’s just a theory.”


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