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Exclusive: How to Ensure Random Numbers in Public Blockchain?

Following Part 1 of our interview, Jing Chen of Algorand further teaches our readers on how to ensure the randomness of a number in public blockchain! She also evaluates the existing Proof-of-Stake (POS) protocols: Delegated VS Bonded VS Pure POS!

Regarding the white paper “Digital Signatures for Consensus” published on March 9, 2019, it states that the signature equation contains a random value r. How do you ensure a random number is really random in the public blockchain?

Randomness is used to select committee members for block generation in Algorand’s pure proof-of-stake consensus protocol. This is done through Verifiable Random Functions (VRF).

The seed of the VRF is generated by block proposers and may depend on the state of the blockchain thus far. The adversary cannot predict the randomness before seeing the block proposer’s message, thus cannot pre-strategize based on it. The randomness used in the protocol is updated every round, and seeing the randomness for the current round does not help an adversary predict the randomness used in future rounds. Similar schemes can be used to generate randomness for other purposes, including digital signatures.

What are the problems of delegated proof-of-stake (DPOS) and bonded proof-of-stake?

While delegated and bonded proof-of-stake approaches are more environmentally conscious – as they do not require the large computation power as found in a proof-of-work system in order to mine a block – they are still centralized by design.

In delegated proof-of-stake, a fixed number of selected entities, or delegates, are selected to generate blocks. Delegates are voted into power by the users of the network, who each get a number of votes proportional to the number of tokens they own on the network (i.e., their stake). However, once delegates are selected, they remain in position for a long time, which inherently makes the system more centralized. Further, there is no guarantee that all delegates will remain honest. And even if their honesty was certain, because their identities are known, they become obvious targets for attackers.

In bonded proof-of-stake, a user’s voting power is proportional to the number of tokens he is willing to “lock-up” —that is, put aside without touching for a long time. If he is caught taking malicious actions within the system, then these tokens may be confiscated. This inherently puts “small” users at a disadvantage, as they may need their tokens frequently and can’t afford to lock a large amount up for a long time. Users with a large total stake, on the other hand, are often more willing to do so, causing the voting power in the system to skew disproportionately towards them.

In comparison, Algorand’s Pure Proof-of-Stake (PPoS) approach randomly selects users in charge of block generation. The randomized selection happens not only per block but actually along every step of the Byzantine agreement per block. Every user may be chosen to propose and vote on blocks. The selection probability is directly proportional to a user’s total stake rather than the stake he is willing to lock up. The protocol does not ask a user to lock up any stake in order to participate, neither does it confiscate a user’s stake.

Why Dutch auction is adopted to determine the token price of Algorand?

The Algorand Foundation is responsible for the distribution of Algos—the native token of the Algorand platform. Algos will initially enter circulation through a sequence of Dutch auctions due to three main benefits they specifically provide – fairness, transparency, and convenience.

A Dutch auction lets the market determines the fair price of tokens rather than having the price set by any specific entity. Also, in a Dutch auction, the token price is the same for all participants who have won any amount of tokens, treating participants fairly.

A Dutch auction is convenient for the users to participate in online. Indeed, during such an auction a user does not need to remain online the entire time. They can make a bid and then move offline, and even return online to make another bid later on.

Finally, auctions are conducted on the Algorand blockchain for transparency. All bids are placed on the blockchain, so everybody can verify that the auction has been conducted properly.

Knowing that most of the dApps in public blockchains related to gaming, how Algorand can attract blockchain developers from existing leaders such as EOS and Tron?

Algorand’s technology stands out in decentralization, scalability, and security. We are committed to building a truly permissionless and decentralized public blockchain; a vision shared by many blockchain developers. The Algorand blockchain offers and will continue to offer many unique features where true technology plays. I invite readers to look at our blog posts on Algorand’s roadmap.

For example, as the Algorand blockchain doesn’t fork, it provides immediate transaction finality. After seeing a newly generated block containing a specific transaction, a user doesn’t need to wait for several other blocks to be generated following it before he can safely rely on that transaction. This is critical for time-sensitive applications, as there is no need to make a tradeoff between having a short confirmation time for transactions and risking certain transactions disappearing from the chain.

Google’s Quantum Technology Could Satiate Proof-of-Stake Detractors

Google’s newly achieved ‘Quantum Supremacy’ computing technology has been marked for some surprising applications in the cryptocurrency space. According to one researcher on the project, the technology could enhance the proof-of-stake (PoS) algorithm.

Crypto Consensus AlgorithmsIn cryptocurrencies, there are two types of consensus algorithms that serve as governing protocols to achieve peer consensus on data values and block ownership on the blockchain—these are proof-of-work (PoW) and proof-of-stake (PoS).PoW uses ‘mining’ where nodes must solve complex equations where the first one to reach the solution is awarded the cryptocurrency and block ownership. In PoS, the process is called ‘forging’, more of a random selection where a node’s chances of owning the next block are greatly boosted by the proportion of assets that they staked in the network. Both have been criticized as formulas to make the rich richer as chances are greatly improved in PoW based on the computation power you can afford and in PoS based on the stake you can afford to commit.In order for the PoS variant process not to favor only the wealthiest nodes on the network, a random selection method is applied. The Randomized Block Selection method makes selections by looking for nodes with a combination of the lowest hash value and the highest stake. However, since the stakes are public, the next forger can usually be predicted by other nodes which has led many to question just how random the selection really is.Quantum Enhancements to Random Selection So how can one be certain that the selections are truly random? Scott Aaronson, a quantum theoretician at the University of Texas, who peer-reviewed Google’s quantum supremacy paper, sees a possible answer to those questions in quantum computing.

On Oct. 23, Aaronson told Fortune that quantum computing could satisfy critics of PoS as Google’s quantum supremacy experiment could be adapted to generate certifiably random numbers. Google’s original quantum supremacy experiment described to Fortune on September 20th, sampled randomly generated numbers produced through a specialized scenario involving ‘quantum phenomena.’ Aaronson believes that applying quantum phenomena to proof of stake will greatly enhance the fairness of the system and solicit its further adoption.

Image via Shutterstock

Ethereum Hits Major Bullish Milestones in Anticipation of the ETH 2.0 Staking Upgrade

Ethereum wallets containing 32 more or more ETH, the amount needed to stake a validator node under the upcoming ETH 2.0 upgrade has hit an all-time high.

The number of Ethereum network balances with 32 ETH or more has been nearing 120,000, in anticipation of the proposed ETH 2.0 update. Validating nodes will be replacing miners in the current proof-of-work system to validate transactions to maintain the Ethereum blockchain.

Over the year, the number of wallets holding at least 32 ETH has risen around 15 percent, according to Nansen AI. Although the ETH 2.0 upgrade has been delayed several times, the major upgrade is expected to be deployed in July.

Ethereum network fees surpassed Bitcoin for the second time in 2020

Ethereum daily network fees have surpassed those of the Bitcoin network for the second time this year. On June 6, on-chain analysis data showed that the total amount of fees spent on the Ethereum network totaled $498,000, while Bitcoin’s total was at $308,000.

The next day, the gap continued its trend, widening to $540,000 and $258,000. Many crypto users suggested Ethereum “flippening” is happening, a term to describe other cryptocurrencies overtaking Bitcoin in value. The crypto community on Twitter went on to call this the “feepening.”

Ethereum addresses hit 100 million

Five years after the initial release of the Ethereum network, the number of ETH addresses/ accounts have reached 100 million in early June.

Although there are over 100 million addresses, this does not necessarily mean that there are 100 million people owning or using the cryptocurrency.

Vitalik Buterin says layer 2 scaling strategy has ‘basically succeeded’

Ethereum has been seeing an upward trend, and demand may increase further in anticipation of the upcoming ETH 2.0 update expected in Q3 2020.

Ethereum is scheduled to undergo a major change of its consensus mechanism, transitioning from proof-of-work (PoW) to proof-of-stake (PoS).

Ethereum has been expecting its scaling to occur for some time, and according to Ethereum’s creator, Vitalik Buterin, it could already be happening.

Vitalik Buterin recently tweeted that the Ethereum blockchain network’s “layer 2 strategy has basically succeeded.”

Previously, Buterin identified blockchain scalability has a difficulty for typical blockchain designs because it requires every node in the network to process every transaction, limiting the transaction processing capacity of the entire system.

To solve the scalability issue, the Ethereum creator identified strategies for scaling, including sharding, also known as the “layer 2 protocols,” which allows transactions to go through without every node processing the whole transaction.

Ethereum 2.0 Developer Says Phase 0 Most Likely Delayed Until 2021, Vitalik Buterin Disagrees

The much-awaited Phase 0 of Ethereum 2.0, also known as Serenity, may not be launched until the beginning of 2021. This was announced by one of the project’s researchers, Justin Drake on Reddit—much to the confusion of Ethereum creator Vitalik Buterin.

Ethereum developer, Justin Drake announced the delay to Serenity’s Phase O in a Reddit ‘Ask me Anything Session’—where he was quizzed on the potential date for the network upgrade. Since Vitalik Buterin announced Ethereum 2.0, its features and development process back in October 2019, the Ethereum community has enthusiastically anticipated the project’s launch date.

While the Reddit session showed that the members of the community are not pleased with the delayed launch, Drake stated that the upcoming holidays will interfere with other programs required to perfect before the project goes live.

Vitalik Buterin Publically Disagrees

As outlined by Justin Drake, the project has a bit more ground to cover before it can go live. The Ethereum Foundation’s strive to implement a public testnet with 3+ clients is one of the primary causes of the delay. This multi-client testnet will have to run smoothly for about 2-3 months according to the developer. An incentivized “attack net” must also run for 2-3 months as well as a bounty program and a serious differential fuzzing across clients. Justin argued that all these are not feasible in the third quarter of 2020 and that the launch will most likely coincide with Bitcoin’s 12th anniversary, January 3, 2021.

Vitalik Buterin, one of the Ethereum Network’s creators, outright disagreed on the proposed delay to launching in 2020. He argued:

“Eth1 took 4 months from the first multi-client testnet to launch (~end of March 2015 Olympic to end of May 2015 for eth1 launch), and I’d argue the four-month clock started ticking for us at the beginning of July when Altona launched. Eth2 phase 0 is in some ways simpler than eth1 and in some ways more complex: more complex PoS, but no complicated GPU-oriented PoW; more optimization required, but no complicated VM, etc etc. I’m inclined to say eth2 phase 0 is a little simpler on-net. Also, eth2 is not going to have any critical applications depending on it until phase 1, so the practical risks of breakage are lower (though you could argue the ecosystem as a whole is bigger). So, on the whole, I see no reason to take more time for the eth2 phase 0 launch cycle than we did for the eth1 launch”

The anticipation of Ethereum 2.0 has sparked some bullish runs in Ethereum’s price in the past weeks. Currently, Ethereum’s price is $240.28 having lost 0.36% to the dollar in the past 24 hours.

Ethereum Calls On Hackers to Attack Ethereum 2.0 in Exchange for Bug Bounty

With Ethereum’s plans to launch its 2.0 protocol network, the open-source platform has also decided to tweak its blockchain project to perfection by calling all hackers and challenging them to break into two Ethereum 2.0 attack networks.

Ethereum Creates the “Hacking Challenge”

What an attack network basically entails is a virtual attempt to break into an organization’s network, without the necessary authentication access passwords and locks required. Usually, the objective of an attack network is simply to steal data or perform other malicious activities.

In the case of Ethereum’s public “attack network” launch, it is mainly to test the vulnerabilities and potential security loopholes of Ethereum 2.0, which consists of an upgrade from the Ethereum blockchain. The cryptocurrency platform hopes that with this “attack network” set in place, Ethereum 2.0 will be perfected — shortcomings of the blockchain may be brought to light with the challenge, that simple testing just won’t be able to reveal.

How to Overcome the Attack Networks

The goal of the attack challenge launched by Ethereum is to prevent finality for 16 consecutive epochs on a network. This means that in order to successfully accomplish the digital mission, hackers would need to be able to intercept “finality” from happening for at least 102 minutes (1 h 42 min). “Finality” simply refers to a type of faster on-chain communication, where a block transaction, once finalized, will not be reversible and will therefore not have to wait for multiple acknowledgments before proceeding forward.

The objective of these attack networks is for others to find potential vulnerabilities and security loopholes that simple testing might not reveal.

In exchange for hackers’ efforts, Ethereum will award a $5000 bounty for each individual hacker or hack group who successfully completes their request.

Ethereum Co-Founder Speaks of 2.0 Project

Vitalik Buterin, one of Ethereum’s most recognized co-founders, is particularly proud when speaking of his Ethereum 2.0, and he emphasizes the fact that the data capacity of the developing blockchain will be immense. However, as his blockchain ecosystem is still developing, the upgrade will not translate to higher scalable transactions, meaning that the blockchain will not necessarily process more transactions.

Another key feature of Ethereum 2.0 is the fact that it will run on a Proof-of-Stake consensus algorithm instead of the current Proof-of-Work Ethereum mainnet. This will enable users in the Ethereum network to lock up their accumulated digital coins and get paid for helping secure the blockchain.

Ethereum's Vitalik Buterin Concerned About Security Risks That Come With High ETH Transaction Fees

By now, it is no secret that Ethereum co-founder Vitalik Buterin and his team are busy perfecting Ethereum 2.0 and preparing it for its official launch.

Ethereum 2.0

One of the key elements of the blockchain ecosystem is that it runs on a Proof-of-Stake (PoS) consensus algorithm, as opposed to the conventional Proof-of-Work (PoW). This enables Ethereum blockchain users to reach distributed consensus when mining a block, and for bullish crypto investors to determine the next block.

Digital asset owners can also lock up their accumulated digital coins and get paid for helping the blockchain.

Will An Upgrade Make Ethereum Faster, Bigger, Stronger?

However, Buterin came forward and while he proudly announced that the data capacity of the developing blockchain will be huge, the Ethereum creator admitted that the higher transaction fee on the blockchain-network may cause unintentionally trigger security risks. Buterin, who can boast that he has co-founded the second largest blockchain network in the world, behind Bitcoin, came forward in a tweet and mentioned a research paper provided by highly reputed Ivy League university, Princeton U. Buterin wrote:

“Transaction fee revenue is now nearing half as high as block reward revenue. This actually risks making Ethereum *less* secure because of https://cs.princeton.edu/~arvindn/publications/mining_CCS.pdf. Fee market reform (ie. EIP 1559) fixes this; another reason why that EIP is important.”

In other words, though it may not be a security issue at this point in time, the higher fees that Ethereum 2.0 will run may potentially cause a security problem long term and be threatening for the blockchain network. The analysis conducted by Princeton university addressed this issue and voiced that selfish mining may pose a real threat, especially in cases where transaction fees surpass the block rewards.

The research paper goes on to name several malicious mining behaviors, that are deviant and may negatively impact Ethereum blockchain.

Introducing EIP 1559

The fee market reform that Buterin referred to in his tweet is none other than the “Ethereum Improvement Proposal (EIP) 1559”, which was first introduced in April 2019. The whitepaper proposes upgrades that would make transaction fees on Ethereum more predictable. This would enable the blockchain network to be more flexible, by dynamically alternating the block size based on the number of transactions that are queued and waiting for validation.

Furthermore, to prevent congestion from happening in the ecosystem, the whitepaper proposed charging users during times of high demand. Buterin publicly voiced his approval and support of EIP 1559 fee market reform.

Slow and Steady Wins the Race: Ethereum Surpasses Bitcoin

The market capitalization of Ethereum currently stands at approximately $26 billion dollars. The astonishing thing about this is that the given value does not even include all of the crypto assets founded atop the Ethereum blockchain ecosystems, such as the stablecoins – Tether and USDC – and altcoins.

Also, data from digital-asset data firm Messari showed that Ethereum had now surpassed Bitcoin as the network that settles the most value per day. Ethereum blockchain daily settlement value is estimated to be about $2.5 billion, which makes it the first time since early 2019 that the blockchain has outranked its rival Bitcoin.

Ethereum Releases Validator Launchpad for ETH 2.0 Testnet

Ethereum software developers finally released the validator launchpad for ETH 2.0, which enabled users to participate in the testnet’s Proof-of-Stake.

Leveling up And Unlocking “Medalla”

The testnet, dubbed “Medalla,” is said to be released on August 4, if all goes well. Ethereum developers behind Medalla have also set up certain criteria that need to be fulfilled for the alternative blockchain to be unlocked.

The test run of the network will be in the hands of the community, and a minimum of 16,385 validators are required for the launch. Each of these users is required to deposit 32 Ether (ETH) coins to access the multi-client testnet. Also, “minimum genesis time” needs to be accomplished, which basically outlines when the earliest launch of ETH 2.0 testnet can be held.

If requirements are not fulfilled, Medalla’s launch will be delayed for 48 hours. The multi-client testnet will only launch if the two criteria are met.

Progress On Unlocking Medalla

So far, it was reported that roughly more than 150,000 ETH tokens have been deposited, meaning that Medalla testnet has achieved 30.5% of the total number of validators it needs for a successful launch next week. Ethereum collaborated with blockchain tech company Consensys and DeepWork Studio to release the ETH 2.0 validator launchpad.

Ethereum Announces Its Testnet Strategy

The blockchain network told its Ethereum crypto community that the multi-client testnet Medalla, they will continue “fine-tuning the interface” in anticipation of the release of the mainnet. In addition to this, Ethereum also explained that as it was transitioning from Proof-of-Work to Proof-of-Stake, Ethereum 2.0 will be launched in at least 3 phases to make sure that all aspects are covered methodically before release.

By breaking up the phases, a different aspect of Ethereum 2.0 can be focused on at each phase and the mainnet can consequently be perfected.

Phases of ETH 2.0

Phases 0, 1, and 2 each outlines a different concept. Phases 0 focuses on all the machinery behind ETH 2.0’s consensus, and it tracks the validators and their transaction balances.

Phase 1’s main objective is to handle the addition and storage of new and old data associated with ETH 2.0.

Finally, Phase 2 adds execution to ETH 2.0, and this simply allows programs to be run on top of it.

Co-Founder Vitalik Pushed for Phase 1

Co-founder of Ethereum Vitalik Buterin has been actively pushing for phase 1 to begin. The Ethereum mastermind wants to get a better grasp of how phase 1 will work in practice. On Reddit, he said that the “clients team” working on Medalla was behind on phase 0, and though that may be the case, they should still start working on phase 1. Buterin justified his strategy, saying:

“There’s no unfinished research required for phase 1; it’s all spec optimization and development.”

Ethereum And Bitcoin “Bull Races”

This year has been a really good year for Ethereum. With their plans of launching ETH 2.0 mainnet, the blockchain platform has also managed to outrank Bitcoin earlier this month, sitting at approximately $2.5 billion and making it the first time since early 2019 that it has outdone its rival BTC.

The latter has however been picking up its pace on the crypto market after months of staying stagnant. Yesterday, it was reported that BTC surged past the $10, 000 mark. BTC as a hedge has also recently been even more of a hot topic, with the depreciation of USD due to economic stimulus packages released by the US government.

Ready, Set, Launch

With Medalla testnet set to launch on August 4, the year 2020 has been good for Ethereum. Medalla is to be the last testnet produced by the dominant cryptocurrency platform before ETH 2.0 mainnet is officially in service and open for public use.

Ethereum Launches ETH 2.0 Multiclient Testnet – Medalla

Ethereum software developers proudly launched the Ethereum 2.0 multiclient testnet, Medalla – the next step on the road to pure Proof-of-Stake.

One Step Closer to ETH 2.0 Mainnet

As promised, Ethereum launched on August 4, at 1 pm UTC. Ethereum enthusiasts have been anticipating the official release of the testnet since Ethereum software developers have announced that Medalla was in the works and will be the last trial blockchain launched before Ethereum 2.0 mainnet comes into play.

Medalla: A Community Project

Ethereum is hoping to transition to a Proof-of-Stake rather than a Proof-of-Work format with Medalla testnet, meaning that block mining will depend on how much an individual has staked. Another key feature of Medalla that Ethereum proudly announced was that the testnet is almost entirely in the hands of the community, meaning the stability and health of the multiclient blockchain will mostly depend on Ethereum validators’ participation. Those who mine on Medalla will reap the rewards of a transaction fee.

Ethereum’s Bull Run

It has been a rewarding year for Ethereum, to say the least. The blockchain ecosystem recently celebrated its 5-year anniversary last week, and they have come a long way since. Five years ago, when the genesis block was first mined into existence on the network, few people outside of the industry had ever heard of Ethereum blockchain.

Now, fast forward to five years later, Ethereum has been making headlines for quite awhile, recently undergoing a flash crash on the crypto market, before steadying back at around $385. Ethereum’s cryptocurrency Ether is the second-largest crypto by market capitalization, trading around $385 at the time of writing. The blockchain ecosystem has also been dominant in the decentralized finance (DeFi) scene, as it is reputed to have the most DeFi applications run on a blockchain, leveraging smart contracts rather than an intermediary.

Ethereum 2.0 Finally Launched

Ethereum programmer Hudson Jameson announced that “Eth 2.0 is a success, it is going really well right now” and hopes that the transition from Ethereum 1.0 to Ethereum 2.0 mainnet will be smooth.

As developers went live on Ethereum Foundation’s YouTube stream to discuss the launch, it seemed that the only cause for concern were that they were seeing lower participation levels from the validators than expected. However, Ethereum software developers stood by the fact that it was just temporary, and that crypto enthusiasts should not jump to conclusions on that aspect. One Ethereum executive said:

“Low participation is just temporary; we will get through this. We have genesis, we have a chain running and resilience built into the protocol. We have an opportunity for the protocol to demonstrate what it can do, which is to recover from low participation from validators.”

Ethereum CEO Vitalik Buterin Pushes for Phase 1

Co-founder and CEO of Ethereum, Vitalik Buterin, had previously commented on his blockchain project, and expressed his wishes to see phase 1 of Medalla testnet initiated as soon as possible. Though phase 0 is still mature and being perfected at the time of writing, Buterin said that phase 1 was all about “spec optimization and development, and that there was no unfinished research required for it.”

Medalla Team Hunts for Cybersecurity Talent

To finish off the live launch, Ethereum developers said that that updates on the progress of Medalla blockchain will be provided on Ethereum’s Reddit account. With Ethereum Foundation doing everything they can to perfect ETH 2.0, Ethereum has also recently announced that it was looking to build a cybersecurity team dedicated to maintaining the ETH 2.0.

Vitalik Buterin Sceptical About DeFi Yield Farming, Compares It to US Federal Reserve Money Printing

Vitalik Buterin has criticized the yield farming craze that has been ongoing in the decentralized finance (DeFi) sector, comparing it to the US Federal Reserve’s mass printing strategy.

Buterin thinks yield farming is unsustainable

The Ethereum co-founder has advised against the yield farming strategy that has gained increasing popularity among the DeFi community and that has partially enabled digital assets such as the Yield.finance (YFI) governance token to gain traction in the market. The DeFi token recently experienced a new record-high of $39,600 on coin exchange Binance, surging by 25%.

Buterin called out the craze of yield farming and said that it was a short-term thing, implying that it was not realistic in the long run. He addressed the sharp supply inflation of many governance tokens, indicating that coins would have to be constantly printed for the ecosystem to keep on running, which was far from ideal for sustainability issues. Taking to his Twitter, Buterin said:

“Seriously, the sheer volume of coins that needs to be printed nonstop to pay liquidity providers in these 50-100%/year yield farming regimes makes major national central banks look like they’re all run by Ron Paul.”

Ron Paul is a retired politician who criticized the establishment of the Federal Reserve and who ran for President of the United States on three separate occasions. Buterin, who is currently working on a multiclient testnet project “Medalla” to attain a full proof-of-stake protocol, is a solid advocate of staking – a software protocol that rewards you with more crypto when you use your digital assets to verify transactions and support the blockchain network.

Scalability issues with DeFi run on Ethereum?

As with yield farming, the DeFi platform awards governance tokens to users who generate liquidity, either through borrowing, lending, or token exchange. These tokens can be used to vote on proposals to update a blockchain network. Governance tokens offer a large monetary reward, as evidenced by DeFi tokens Yearn.finance (YFI) and Aave (LEND)’s digital yields. However, as more tokens have been locked into DeFi projects, their supply is limited.

As DeFi protocols operate mainly on the Ethereum blockchain and the DeFi industry is currently booming and increasingly leveraged by emerging economies, concerns about the Ethereum network’s scalability have once again resurfaced. Due to the complexity of smart contract protocols on Ethereum and most DeFi projects running on the open-source blockchain platform, transaction fees to unlock basic operations have hit triple-figures.

Buterin has announced that “sharding” will be tested out in Phase 1 of Medalla testnet, which is the final testnet set in place before a complete transition to proof-of-stake is adopted by Ethereum. Buterin hopes that bugs and scalability issues can be worked out with Medalla test chain, before Ethereum 2.0 mainnet’s anticipated launch, anticipated for the end of 2022 if all goes well.

USD is dropping, investors looking for hedges

As the US dollar keeps depreciating with the Federal Reserve’s mass money printing strategy to deliver COVID-19 stimulus relief, big-name investors such as Warren Buffett have sought out other hedges to secure their funds. Warren Buffett has recently announced that he was investing in the Japanese market and moving his assets out of USD. As for the Winklevoss twins, the Gemini co-founders have long touted Bitcoin’s horn and advised people to invest in the digital asset, as they assert that the cryptocurrency is only going to keep soaring in value. The Winklevoss brothers have repeatedly said that Bitcoin was the way to go, backing their belief by saying that the “digital gold” asset had a limited supply of 21 million, and its value will consequently rise.

Ethereum Devs Launch Spadina Testnet, What Needs to be Perfected for ETH 2.0?

Just when the Ethereum community thought that Medalla was going to be the last testnet before Ethereum 2.0 mainnet’s official release, developers have unveiled yet another.

Ethereum developers have once again launched another testnet, bringing them one step closer to replacing the current Ethereum public mainnet with a new blockchain that will operate based on a Proof-of-Stake (PoS) protocol.

Spadina, a rehearsal launch for Ethereum 2.0

Spadina, the newest addition to the string of testnets developers have unveiled in preparation for Ethereum 2.0’s Phase 0, is said to be a short “dress rehearsal” for validators before the mainnet launch. Released on September 29, Spadina testnet will only be active for 72 hours, and the network will operate in parallel with Medalla, the multi-client testnet that Ethereum launched at the beginning of August.

The main focus for developers and Ether stakers on Spadina is to practice their deposit and genesis chops before Ethereum 2.0. Speaking on behalf of the Ethereum ecosystem, mainnet lead researcher Danny Ryan said:

“The main objective is to give us all another chance to go through one of the more difficult and risky parts of the process – deposits and genesis – before we reach mainnet. If all goes well, it should give us greater peace of mind before we jump into the real deal later this year.”

Just like Medalla testnet, the main problem that occurred with Spadina’s launch was that there were lower participation rates than expected. The first round of validators was reported to be below 35%, with the target for participation levels set at 80%.

However, developers have affirmed that this was nothing to worry about, as the low participation levels are maybe due to the fact that no real Ether is “at stake,” since Medalla and Spadina are a chance for validators and for the community to practice staking in anticipation of the future chain.

Despite the slight drawback, it has been announced that Ethereum developers were quite happy with the outcome of Spadina’s launch, as blocks were handled successfully by the clients in the deposit process. According to Ryan, Spadina testnet’s launch was “90% successful.”

When Ethereum 2.0 mainnet launches, the issue of offline stakers will likely not be a problem anymore, as real ETH will be running on the chain.

Ethereum 2.0 mainnet

Ethereum 2.0 will be launched in three phases so that during each stage, different aspects could be focused on to achieve a highly scalable and healthy blockchain.

The future mainnet will be an upgrade and a replacement of the current Ethereum blockchain, as developers are actively working on making the necessary adjustments to transition from a Proof-of-Work (PoW) protocol to a Proof-of-Stake (PoS) blockchain.

Although an official launch date has not been set, Phase 0 of Ethereum 2.0 is predicted to be in effect before the end of 2020, as disclosed by one of the top client teams staking on Ethereum testnet.

Recently, with most decentralized finance(DeFi) protocols running on its chain, Ethereum’s transaction fees reached new highs, with gas prices hitting 700 gwei. On average, gwei prices are supposed to be around 416. The issue of scalability will need to be addressed and upgraded with ETH 2.0, which is said to increase transaction processing on Ethereum from 15 transactions per second to approximately 100,000 transactions per second.