Ethereum 2.0 with 100,000 TPS close at hand

If all goes according to plan, Ethereum’s transition to an environmentally friendly blockchain that is capable of scaling far beyond what will be necessary to make it a viable payment lane will take place on 19 September.

It is then – if all goes according to plan – that the blockchain # 2 will undergo the “merger”, and switch from the current Bitcoin-style consensus mechanism that requires as much power as the whole country to an environmentally friendly proof-of-effort (PoS) – process that will keep it secure while adding new blocks of transactions to the blockchain with virtually no appreciable carbon footprint.

See also: Crypto Basics Series: What is a Consensus Mechanism and Why Does It Destroy the Planet?

Seven years in the making, the new Ethereum 2.0 will see the primary smart contract platform be able to scale to 100,000 transactions per second (TPS) with a 12-second “blocking time” that will give that transaction final in about 6 minutes.

Read more: Ethereum 2.0 will not be faster, said Vitalik Buterin. But it will still scale massively

The merger is when all existing applications on Ethereum – including most of decentralized finance (DeFi), as well as most blockchain-based projects such as supply chain management and cross-border payments will be transferred to the PoS Ethereum 2.0 blockchain.

All of these applications are based on the use of self-performing smart contracts, which is the primary mechanism behind any use of blockchain other than as a direct payment currency.

See more: DeFi series: What is a smart contract?

The move to Ethereum 2.0 is fast becoming more important for the broader cryptocurrency industry, as concerns about the dizzying pollution caused by Bitcoin and Ethereum threaten the entire technology, and mainstream investors and companies are increasingly disappointed with blockchain’s biggest Achilles heel.

See also: Can Proof-of-Stake Solve Crypto’s ESG Problem?

While warning that September 19 is not a fixed date, Ethereum developer Tim Beiko’s forecast is the first time a merger date has been given, beyond a timeline of months or quarters. The price of ether rose 45% over the weekend on the news.

This merger timeline is not final, but it is extremely exciting to see it come together. Look at this as a planning timeline and watch out for official announcements! pic.twitter.com/MY8VFOv0SI

– superphiz.eth 🦇🔊🐼 (@superphiz) July 14, 2022

A real payment solution

For the payment industry, however, 19 September is not the key date. It is estimated to be in the first quarter of 2023, with the introduction of “sharding” technology to Ethereum 2.0, which is mainly the ability to break the network into pieces.

This promises to increase the speed and number of transactions the blockchain can handle significantly and drastically lower transaction fees that can range from several dollars to well over $ 100 – even though in recent weeks it has fallen just under $ 1 for the first time in several years.

In the meantime, however, making transactions faster and cheaper will still require the use of Layer 2 solutions such as Polygon, which builds a second blockchain on top of the Ethereum network where transactions take place, with only the completed data moved down to Ethereum. added to the immutable block chain.

Read more: Blockchain Basics series: What is polygon? An Ethereum killer secures his efforts

It works in the same way as Bitcoins Lightning Network, which is quickly taken into use by payment processors such as Blocks Cash App and Stripe when they roll out affordable, scalable payments.

See also: Stripe rolls out crypto payment options, Twitter logs in as first user

See also: Bring Bitcoin Fixed in Payments, Strike Partners with NCR, Shopify, Blackhawk

See also: The Cash app integrates Bitcoin Lightning payments

Although there have been concerns that PoS is not as secure as PoW mining, it should not be a problem for Ethereum 2.0. This is because security concerns are a factor in how many “validators” PoS networks have that ensure transactions are genuine and fairly added to a blockchain. They set up stakes – mainly bonds – that can be seized by smart contracts for bad behavior.

While some have less than a dozen, Ethereum 2.0 requires a minimum of more than 16,000 and currently has almost 350,000 on the test networks before the merger. Approximately $ 35 billion is prepaid for Ethereum 2.0.

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