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Ethereum Vs Ethereum 2.0 [Key Differences] In 2024. The idea for a blockchain platform that may facilitate the creation of applications using a generic scripting language was first put forth by Vitalik Buterin in 2013. Following this, Buterim became one of seven co-founders working on the Ethereum smart contract platform for DApps. Dapps built on Ethereum did not succeed in attracting consumers because of its limitations in scalability, cost, and PoW complexity. Now that we have a good grasp of the basics, let’s compare and contrast ETH with Ethereum 2.0.
What is Ethereum?
The co-founder of the Ethereum blockchain, Vitalik Buterin, introduced Ethereum in 2015. Ethereum is a free and open-source software platform that developers may use to create decentralized apps, smart contracts, shared ledgers, and other legal and financial apps. In terms of market value, ETH is now second only to Bitcoin.
Introduction of Ethereum Virtual Machine
The majority of blockchains before Ethereum were concerned with the transactions of currency supported by a network. Vitalik Buterin, developer of Ethereum, had an idea to change that idea and started working on a better blockchain. With the help of the “Ethereum Virtual Machine or EVM,” users will be able to personalize data on the Ethereum network. With EVM, users may now employ smart contracts to complete transactions.
Smart Contracts
Buterin is to be thanked for implementing smart contracts to safeguard all Ethereum blockchain transactions. With EVM, you can be certain that every Ethereum transaction is legally binding and that all parties have read and understood the terms and conditions.
Decentralized Applications of DAPPS
There is an infinite number of possible transactions on the ETH blockchain. Using ETH and its built-in smart contracts, you can accomplish anything in minutes, from sending emails to paying rent or donating to charity trusts. Along with other features like file storage, voting, reputation systems, financial derivatives, and token economies, Ethereum also lets users construct decentralized applications.
Ethereum Token Ether (ETH) and Ethereum Gas
The ETH blockchain and all of its transactions, including the distribution of incentives to shareholders, are conducted using the native coin, Ether, or ETH. To power the network, users can also purchase ETH Gas with the ETH token. ETH Gas powers all transactions and smart contracts. Gas prices and amounts are transaction-specific. The network can save money and avoid wasting resources thanks to the gas.
It is common for Ethereum developers to build EVM applications that do not utilize sufficient gas to execute smart contracts. The miners will immediately stop validating certain transactions, and the network will reject them. With time, the app’s developer can become unreliable in the eyes of the network. Each miner is assigned a specific task by EVM to ensure the network runs smoothly and effectively. Network gas improves the network’s overall efficiency by reducing transaction velocity and ensuring transactions are validated promptly.
Ethereum (PoW) Vs Ethereum2.0 (PoS)
To reach a consensus, the Ethereum blockchain used the Proof-of-Work (PoW) method. Satoshi Nakamoto, the anonymous creator of the Bitcoin blockchain, was the first to propose the PoW.
Ethereum 2.0:
The developers of Ethereum are quickly moving towards the Proof-of-Stake (PoS) consensus mechanism. Within the blockchain community, this change has sparked numerous debates. However, what is the need for this change? “Mining” describes this procedure. “Ether” is the currency that the miners obtain as a reward. The network creates a new block whenever a miner finds the solution to a mathematical challenge.
Problem With Cost and Scalability
This method was first introduced by Satoshi Nakamoto in 2008 on the Bitcoin blockchain, and since then, numerous other blockchain networks have adopted it as a means to compensate their miners. The blockchain community has learned through experience that the conventional approach to block generation has a few flaws. In addition to being time-consuming, the method is expensive, power-hungry, and not scalable.
An attacker would have to run faster than the sum of all the validators in the network—51%—to interfere with the process, which is not going to happen.
Casper Protocol [Moving PoW to PoS]
ETH has decided to use the PoS system developed by Casper. There will be a PoS checkpoint every 50th block in the PoW-mined blocks. Validators take the place of the miners in this manner.
In light of this, PoS is a consensus mechanism that is significantly more advanced than PoW. Compared to PoW, PoS uses less electricity and computational power. It is significantly more secure than PoW and more scalable because the whole consensus is dependent on the size of the shareholder investment. See our page on PoW vs. PoS to learn more about PoS and PoW.
Ethereum2.0: Beyond Just Proof-of-Stake
The ETH blockchain’s proof-of-stake has advanced with the release of Ethereum 2.0. It has the following extra features:
- Sharding – It is a form of data partitioning where large databases are kept in small manageable resources.
- eWASM – Ethereum Web Assembly (eWASM) helps in faster execution of the codes.
- Plasma and Raiden – Scaling solutions that can handle large volumes of transactions.
In the future, the ETH Developer Community will be adding new functionality to the ETH 2.0 network. They anticipate that this will enhance the adoption of smart contracts, expedite transactions, and draw in new investors to the network. Though the majority of technological advancements, including the hard fork’s execution, have been successful, there have been disagreements concerning the growth of PoS consensus in the ETH 2.0 network. Concerns regarding the network’s effectiveness are common among investors.
