Ethereum change consensus

2.

There is an essential difference between Ethereum and bitcoin. What is the difference? Bitcoin defines a set of currency system, while Ethereum focuses on building a main chain (which can be understood as a road) to allow a large number of blockchain applications to run on this road

from this point of view, Ethereum's application scenarios are more extensive, which is why we say that Ethereum marks a simple monetary system in the era of blockchain

1.0, and a transformation to other instries and application scenarios in the era of blockchain 2.0

however, there is no perfect thing in the world. Although Ethereum has expanded the application scope of blockchain in all walks of life and improved the speed of transaction processing, it also has some disputes and doubts

first, the solution to the lack of scalability of Ethereum: slicing technology and lightning network

the bottom design of Ethereum, the biggest problem is that Ethereum has only one chain and no side chain, which means that all programs have to run on this chain equally, consuming resources and causing system congestion. Just like last year's very popular Ethereum game "encryption cat", when this game was very popular, it once caused Ethereum network paralysis

to improve the processing capacity, Ethereum proposes two ways: shard and lightning network. Let's introce these two technologies respectively

(1) fragmentation technology

vitalik buterin, founder of Ethereum, believes that the reason why mainstream blockchain networks such as bitcoin process transactions very slowly is that every miner has to process every transaction in the whole network, which is actually very inefficient. The idea of fragmentation technology is: a transaction does not need to be processed by all nodes in the whole network, as long as some nodes (miners) in the network are allowed to process it. Therefore, Ethereum network is divided into many pieces. At the same time, each piece can handle different transactions. In this way, the network performance will be greatly improved

however, the slicing technology is also controversial. As we all know, the important idea of blockchain technology is decentralization. Only when the whole network witnesses (processes) the same transaction can it have the highest authority. The Ethereum slicing technology is similar to the group witness, not all nodes witness together. In this way, it will lose the absolute "decentralization" attribute, and can only achieve the purpose of high performance by sacrificing certain characteristics of decentralization

(2) lightning network

lightning network uses the way of transaction under the chain. What does that mean? It means: when the participants of lightning network transfer money to each other, they do not need to confirm the transaction through the main chain of Ethereum, but create a payment channel between the participants and complete it under the chain

however, lightning network is not separated from the main chain. Before establishing a payment channel, you need to use the assets on the main chain as collateral to generate a balance proof, which indicates that you can transfer the corresponding balance. In the case that both parties of the transaction hold the balance certificate, both parties can make unlimited number of transfers under the chain through the payment channel

only when the off chain transaction is completed and the assets need to be transferred back to the chain, the balance change information of the main chain account will be registered on the Ethereum main chain, and no matter how many transactions occur ring this period, there will be no record on the main chain

another real benefit of lightning network is that it can save the cost of miners for you. At present, when we trade on the main chain of Ethereum, we need to consume gas and pay for miners. Once we move the transaction to the lower chain, we can save this part of the cost

Of course, lightning network is not perfect. When using the lightning network, the assets on the main chain should be used as collateral; And this part of assets as collateral can not be used before the user completes the transaction under the chain. This also determines that lightning trading is only suitable for small transactions

the above is the problem of insufficient scalability of Ethereum, as well as the two main solutions: fragmentation technology and lightning network

Second, there are loopholes in Ethereum's smart contract and the infamous Dao event

Ethereum's smart contract is very powerful, but there are loopholes in any code. The biggest controversy of Ethereum's smart contract lies in the so-called loopholes, that is, security issues. According to relevant research, 34200 (about 3%) of the nearly 1 million smart contracts based on Ethereum contain security vulnerabilities, which will allow hackers to steal eth, freeze assets or delete contracts, such as the infamous Dao incident

(1) what does Dao mean

before introcing the Dao event, let's first introce what Dao is. Dao is the abbreviation of decentralized

autonomous organization, which can be understood as decentralized autonomous organization. From the perspective of Ethereum, Dao is a kind of contract or a combination of contracts on the blockchain, which is used to replace the government's review and complex intermediate proceres, so as to achieve an efficient and decentralized trust system. Therefore, Dao is not a specific organization, that is to say, there can be many Dao, all kinds of Dao

(2) the infamous Dao event

however, when we talk about Dao now, we basically refer to the Dao event, that is, the infamous hacker attack event we just mentioned. As we know, the English word "the" refers to "the Dao event". The Dao event

refers to "the Dao event", because we just said that Dao is not a specific organization, there can be many Dao, all kinds of Dao

in 2016, slock.it, a German company focusing on "smart locks", launched the Dao project on Ethereum in order to realize decentralized physical exchange (such as apartments and ships). Since April 30, 2016, the financing window has been open for 28 days

unexpectedly, this Dao project is very popular. It raised more than US $100 million in just half a month. By the end of the whole financing period, it raised a total of US $150 million. Therefore, it has become the largest crowdfunding project in history. However, it didn't last long. In June, hackers took advantage of the loopholes in the smart contract to successfully transfer more than 3.6 million Ethernet coins and put them into a Dao sub organization, which has the same structure as the Dao. At that time, the price of Ethernet currency fell directly from more than $20 to less than $13

this event shows that there are loopholes in smart contracts, and once the loopholes are exploited by hackers, the consequences will be very serious. This is why many people criticize Ethereum and say that its smart contract is not smart

to solve this problem, many foreign companies begin to provide code audit services in order to solve the vulnerability problem of smart contract. From a technical point of view, some teams are currently testing smart contracts. Most of these teams are led by professors from Harvard, Stanford and Yale, and some of them have obtained investment from leading institutions

in addition to the problems of insufficient expansibility and loopholes in smart contracts, the controversy over Ethereum lies in the POS consensus mechanism it pursues, that is, the proof of equity mechanism. Under the proof of equity mechanism, if anyone holds more money and holds it for a longer time, he will get more "rights" (interests) and have the opportunity to get bookkeeping power, Bookkeeping can also be rewarded. In this way, it is easy to create the oligarchic advantage of "the stronger the stronger"

Another problem is the chaos of ICO. ICO is a common way to raise funds for blockchain projects, which we can understand as pre-sale. The outbreak of ICO projects on Ethereum has caused illegal activities such as fund allocation and money fraud under the banner of ICO, which has caused security risks to social and financial stability

3. Ethereum blockchain has exposed three major problems, and its founder vitalik buterin has been unable to interpret them for a long time. The first is the low performance and TPS of Ethereum blockchain as a whole; The second is that resources are not isolated. The event of cryptokitties virtual cat once occupied 20% of the traffic of the whole Ethereum, which directly caused Ethereum network users unable to carry out timely transactions, which is the biggest pain point of resources not isolated; The third problem lies in the embodiment of Ethereum's governance structure. As a decentralized distributed ledger, the founder team of Ethereum has dominated its network development in the past. The over centralized governance mode has led to the bifurcation of eth, etc and ETF in Ethereum, and the Ethereum community is now in a state of fragmented governance. In the view of Ma Haobo, founder and CEO of "aelf", all kinds of disadvantages of Ethereum are unacceptable. Therefore, the positioning of "aelf" is born for the next generation of decentralized underlying computing platform of Ethereum, which focuses on solving the problems of insufficient performance, non isolation of resources and governance structure of Ethereum.

4. 1. What is the ether classic<

etc (Ethereum Classic) is a bifurcated currency that Ethereum hard bifurcates after 1920000 blocks, and its function is very similar to Ethereum. Etc adheres to the concept of decentralization and supports the consensus mechanism of blockchain guarantee. Etc firmly believes that once the blockchain starts to run, its development direction will not be controlled by any central team, but will be determined by the consensus of the people participating in the whole network and the consensus of the computing power of the whole network

the Ethereum blockchain hard branching in July 2016 aims to transfer the Dao funds stolen by hackers to an account controlled by investors, and let the old transaction records be forgotten by history. Most Ethereum developers are involved in the reversal, as are exchanges, startups and other members of the ecosystem. A few days later, the project returned to normal. But not everyone wants to forget the old record. As a result, a small number of miners continued to use the original blockchain as a protest. They described the hard fork as a capital withdrawal for the abandoned project of the Dao. So Ethereum classic (etc) was born

2. Detailed parameters

Chinese Name: Ethereum classic English Name: Ethereum classic English abbreviation: etc

developer: Ethereum Classic team core algorithm: ethash consensus proof: POW

release date: 2016 / 7 / 20 block time: About 15-17 seconds / block

total currency: fixed at 210 million, up to 230 million, Every 5 million blocks decelerate by 20%, and the first proction rection is expected to be in December 2017

main features: independent cryptocurrency

5. Ethereum architecture consciousness is the 6-tier architecture of regional block chain. They are: data layer, network layer, consensus layer, incentive layer, contract layer and application layer. I personally feel that the best thing to do in Ethereum development is Shengshi Huacai, which is very professional

6. There are many consensus mechanisms in the blockchain. The advantage of the pow consensus mechanism behind bitcoin, the most influential one, is that it is secure and can not be tampered with. The disadvantage is that it is too slow to process only seven transactions a second

7. With the upgrading of Ethereum to version 2.0 this year, the consensus mechanism will be converted to POS, which will have a huge impact on miners. There are two choices for miners. One is to sell mining equipment and buy eth to adapt to the stacking mechanism of POS; The second is to switch the miner to other networks supporting GPU miner. Nick foster, a representative of kabombacks, a US mining equipment distributor, said most eth miners would choose the latter

after Ethereum is upgraded to version 2.0 POS mechanism, miners may switch mining machines to other networks
as Ethereum is finally ready to start its Ethereum 2.0 upgrade later this year, thus eliminating the long-term delay, the network will start to move towards the proof of rights model

therefore, the network will give up the workload proof consensus algorithm, so that eth miners have little choice. As their equipment will become obsolete, they will be forced to start mining counterfeit coins or re qualify as eth mortgagors. So, what is the current situation of Ethereum mining? With the coming transition, what will happen to the whole instry< At present, Ethereum consensus is based on POW system, which is similar to bitcoin (BTC). As a result, Ethereum's mining process is almost the same, as miners use their computing resources to earn rewards for each block they try to complete< However, there are still major differences between these processes. Although bitcoin mining has relied almost entirely on ASIC (large, loud machines designed specifically for cryptocurrency mining, most of which are concentrated in areas with low electricity prices), Ethereum's pow hash algorithm ethash is designed to support global chip manufacturers (such as NVIDIA and AMD). As Thomas Heller, global business director of cryptocurrency mining pool f2pool, explained in a conversation with cointegraph, GPU is much cheaper and easier to access than ASIC

"as ASIC is a very professional machine, when a new generation of procts is released, it is usually a huge technological leap. As a result, they have a much higher hash rate and are more energy efficient than the previous generation. This means that those manufacturers have spent a lot of money to research and develop it. Their machines are usually very expensive, and GPUs are much cheaper. "

Heller added that those who use GPU miners "have more flexibility to mine." For example, the popular NVIDIA geforce GTX 1080 Ti card can mine more than 15 different currencies, while ASIC units usually support only one currency

nevertheless, Ethereum is not completely immune to ASIC miners - at least in its current state. In April 2018, bitcontinent released antminer E3, an ASIC specially proced for mining Ethereum. Although widely praised for its hash rate of 180 megahashes per second and power consumption of 800 watts, it has received different responses from the Ethereum community. After the ASIC is inserted, a considerable number of GPU rig owners seem to suffer from loss of profits, and some are even forced to switch to other networks

"in the white paper, ETH must have ASIC resistance. I would like to say that the white paper stands for something "is one of the highest comments on the AR / ethermining topic about the topic discussed when antminer E3 was announced. Another reddit user argued that "the $800 only applies to 180mh."“ Split or die of a nation. "

some Ethereum users continue to suggest that bitmain's mining devices can lead to greater concentration, thus increasing the possibility of attack by 51%. Soon, a group of developers put forward "programmed workload proof" or progpow, which is an extension of the current Ethereum algorithm ethash, aiming to make GPU more competitive and promote decentralization

according to a paper published in March by Kristy Leigh Minehan, co-founder of progpow, about 40% of the hash rate of Ethereum is generated by bitmain ASIC. Alejandro de la Torre, the vice president of poolin, is the sixth largest pool of eth. He confirmed to cointegration that "GPU mining is still dominant" in Ethereum network, and added:

"at present, the profit of eth mining is not high, and the management threshold and cost of GPU equipment are higher than ASIC equipment. Compared with ASIC devices, GPU devices are more flexible, and you can use other algorithms to switch to other coins. "

progpow has not been integrated into Ethereum, and it is not clear when it will be finally implemented - in March, Ethereum core developers were debating whether progpow will really benefit the network in nearly two hours, and failed to reach a consensus. It is worth noting that a bitmain representative has previously told cointegraph that the mining hardware giant does not intend to extend the service life of antminer E3 to start operation after October 2020: "as far as we know, mining will end in October or some time after that."

a safe but uncertain future

indeed, Ethereum will stay away from mining in the future. Ethereum 2.0, which is planned to be launched later in 2020, is a major network upgrade on the blockchain, aiming to transfer its current POW consensus algorithm to a virtual POS (known as "block verifier")

more specifically, users are randomly selected considering their wealth in the network or their "interests". In other words, the more coins a POS verifier chooses to put in, the more coins accumulated as a reward

according to vitalik buterin, the co-founder of Ethereum, e to the transition, the network will be more secure and the attack cost will be higher than the network of bitcoin, although the debate about the better consensus algorithm in the encryption community has lasted for many years. However, it is not clear when to start Ethereum 2.0, as many errors and management issues are reported to be delaying the process

another hypothetical benefit of POS system is that it has higher energy efficiency than pow blockchain. According to digiconomist, the cryptocurrency's total annual footprint is 59.31 terawatts per hour, which is comparable to the electricity consumption of Greece as a whole. However, since a report in July 2019 estimated that 74% of the exploitation of bitcoin was done using renewable energy, the environmental impact of bitcoin does not seem to be so serious

what will happen to the actual Ethereum miner? According to the documentation of Casper upgrade as part of Ethereum 2.0 roadmap, the network will initially support a hybrid model including both POW and POS, thus providing some space for block verifiers and GPU / ASIC miners. Jack O & 39, CEO of skale network; "There will definitely be a transition period when two networks are running at the same time," Holleran told cointegration The CEO of scale network (based on Ethereum's blockchain platform) gave a detailed description of this process:

"the transition from eth1 to eth2 takes time of course - it may be years rather than months. The good news about this slow transition is that dapps and defi platforms will be able to roam around based on survivability, security and real-world evidence of adoption. This is a positive impact on the Ethereum ecosystem. "

dig or not

once Ethereum is fully in the POS orbit, miners will have two options. One is to sell the equipment and use the money to accumulate more Eth and start mortgage. The other is the choice for GPU miners, which is simply switching to other ethash networks and mining counterfeit money. Nick foster, a representative of kabombacks, a US mining equipment dealer, told cointegration that most eth miners would choose the latter:

"what I want to say is that most of the miners have not really entered Ethereum or the mining of specific tokens. Yes, there is a certain amount of mineral deposits and holds, but I oppose the view that a large number of Shanzhai coin miners hold their coins at any time. "<

foster then described how he used 3gb GPU units to mine ethash's point-to-point blockchain asset ravencoin (RVN). Once it was unable to mine eth, he said, "this is the reason for mining crows. I immediately sold stability to BTC, and then sold it to US dollars to pay for my rights. I would say that a lot of people are adopting this strategy. "

as foster concludes, he wants eth miners to jump out of the network, and new players - those who don't invest in power infrastructure or drilling rigs - will take a stake in eth. He described the following:

"I can't imagine if I found a five-year lease with $0.04 of electricity and I was mining eth, I decided to sell everything and then continue to pay the rent so that I could hold eth as a share. Substitute. "

Marc fresa, founder of asic.to, a mining firmware company, agreed in a conversation with cointegraph: "if you invest in mining, you won't bet because you have enough room to grow."

one of the main counterfeit coins that may benefit from POW miners leaving Ethereum is Ethereum classic (etc), which is a more conservative version of the blockchain. It is reported that there is no POS related plan. As it also runs on the ethash algorithm, the startup of Ethereum 2.0 may lead to the migration of miners, so its hash rate may have a significant peak

eth's larger pools have similar options. When asked about the company's plans for Ethereum after pow, Heller told cointegraph that after the announcement of Ethereum's POS upgrade, f2pool launched a sister company called story.fish in early 2018. Story.fish has started to provide mortgage services for other POS and delegated POS projects, such as tezos (xtz), Cosmos (atom) and Cardano (ADA), e to numerous handover delays. For prin, e to the transition to POS, it "may temporarily give up supporting eth mining," de la Torre told cointegraph

other top eth pools, namely nanopool, ethermine, pool center, sparkpool and spiderpool, did not respond to requests for comment from cointegraph.

8. The bifurcation of Ethereum Constantinople is about to begin. Many people are curious about this bifurcation and are not sure whether they need to be prepared in advance
to put it simply: if you are only the holder of eth, you don't need to make any preparation for this upgrade.

9. POW: proof of work (POW), a simple explanation is a proof to confirm that you have done a certain amount of work. Because the whole process of monitoring work is usually extremely inefficient, and it is a very efficient way to prove that the corresponding workload has been completed through the certification of the work results. For example, in real life, graation certificate, driver's license and so on, are obtained by means of test results. That is to say, how much money you get depends on your effective contribution to mining. Simply understand, the better your computer performance, the more revenue you will get. This is to allocate money according to your workload. Most digital currencies, such as bitcoin, lightcoin, etc., are virtual currencies based on POW mode (the higher the computing power, the longer the mining time, the more coins you get)
pos: POS is a consensus algorithm in the public chain, which can be used as a replacement of pow algorithm. POW is a mechanism to ensure the security of bitcoin, Ethereum and many other blockchains, but POW algorithm is criticized for destroying the environment and wasting power in the process of mining. POS tries to solve these problems by replacing the concept of mining with a different mechanism
POS mechanism can be described as a kind of virtual mining. POS mainly relies on the token in the blockchain itself. In pow, a user may buy a computer for 1000 dollars, join the network to mine and proce new blocks, and get a reward. In POS, users can buy tokens of equal value with us $1000 and put them into the POS mechanism as deposit, so that users have the opportunity to generate new blocks and get rewards. In pow, if users spend $2000 on hardware equipment, they will of course get twice the computing power to mine, thus getting twice the reward. Similarly, if you invest twice as much token as the deposit in the POS mechanism, you have twice as much chance to get the right to generate new blocks.

10. Casper is a consensus mechanism of the next generation of Ethereum, which belongs to POS. Casper's consensus was reached by blocks, not by chains, as pos did. Currency exchange of digital currency