At 2:45 pm on September 15th, the consensus mechanism of Ethereum transitioned from Proof of Work (PoW) to Proof of Stake (PoS), and the historic feat of “merger” that the cryptocurrency community had been waiting for for more than 5 years was finally successfully completed. . After achieving this great technical feat, the core developers of the Ethereum network began to ponder another question: what’s next for Ethereum?
In fact, the developers have already set their sights on the next upgrade: Shanghai.
While there won’t be group meetings or collective decisions about the network’s future for Ethereum core developers for the next two to three weeks, the short break won’t last long, and next month they need to collectively Determine what features will be included in the next upgrade of Ethereum – Shanghai. You know, digital assets worth tens of billions of dollars are deployed on the Ethereum blockchain today, so the first upgrade after the merger is particularly critical.
“Money” can’t get out, people can’t get in
Micah Zoltu, a core developer of Ethereum, said that the community has a lot of ideas for the “Shanghai” upgrade, but no consensus has been reached yet. One of the new features that is most urgently updated is to allow Ethereum verifiers to withdraw pledged ETH.
The biggest change brought by the merger to the Ethereum blockchain is to turn the network consensus mechanism into a “proof of stake”, that is, all transactions on the network will no longer be verified by energy-intensive “miners”, but by deposits or pledges. A large number of ETH individuals and organizations “validators” are verified. For validators, their staked ETH can generate and collect new ETH, and these so-called “new ETH” are their reward for validating transactions and securing the network.
However, so far, Ethereum’s staking mechanism can only deposit ETH and cannot withdraw ETH.
According to the official network data of Ethereum, the number of network validators has reached 427,326, and the total amount of pledged ETH has reached 14,451,487 ETH. According to the current ETH price, the total pledged value is close to 22 billion US dollars, but all these ETHs are now “trapped” On the Ethereum network, unless the developer adds withdrawal functionality.
It is understandable that in the Shanghai upgrade, almost all core developers will put the pledged ETH withdrawal function in the first place, otherwise the attractiveness of the pledged ETH will be greatly reduced, because people find that their pledged ETH cannot be withdrawn for a long time. Weakening the motivation of “verifiers” to pledge, there will not be so many people entering the Ethereum network in the future, which will undoubtedly have a huge impact on the future development of Ethereum and network security.
Ethereum core developer Marius Van Der Wijden admitted that core developers may agree to address the issue of pledged ETH withdrawals in the next “Shanghai” upgrade, “which is almost a sure thing.” However, what else will be included in the “Shanghai” upgrade is unclear.
What’s next for Ethereum after staking?
Micah Zoltu believes that the biggest problem with the “Shanghai” upgrade now is that “everyone has a different list”. Everyone feels that their proposals are “the most urgent”, but these ideas are very subjective and there is no consensus.
Nonetheless, in addition to the addition of the pledged ETH withdrawal function, there may be other potential updates in the Ethereum “Shanghai” upgrade, such as:
1. Ethereum Virtual Machine (EVM) update. EVM is a developer-oriented underlying mechanism of Ethereum that defines the rules governing how blocks interact on the network. Ethereum hasn’t made any updates to the EVM in over two years, in part because of concerns that the update would cause trouble for mergers. As Marius Van Der Wijden said, updating the EVM before merging leads to a 10x increase in test complexity and makes upgrades more difficult.
2. Proto-danksharding update. The Proto-danksharding upgrade has been rumored for a long time, and has also attracted huge interest in the Ethereum community, and is related to the Rollups scalability technology. Rollups is an Ethereum network scaling tool that aggregates transaction sets into a unit, and then presents the unit to the Ethereum blockchain as an independent transaction, thus solving the slow transaction processing speed of the Ethereum mainnet and high gas fees The problem.
Proto-danksharding can be seen as a preliminary version of danksharding. During the Proto-danksharding process, a large amount of data on Rollups can be verified by simply sampling small block data. Essentially, this update should greatly improve Optimism The speed and ease of validating large amounts of data with Ethereum Layer 2 networks like Arbitrum. Van Der Wijden added that Proto-danksharding could reduce Rollup’s on-chain gas costs and also make it easier for Rollup to scale massively, while also reducing transaction costs significantly. However, although danksharding is very attractive to Layer 2 users, and the upgrade can cut gas costs and reduce transaction time, the development work requires a lot of energy and time.
The dilemma facing the upgrade of “Shanghai”
The more feature sets included in the Ethereum “Shanghai” upgrade, the more complex the upgrade will be and, more importantly, the delay in the upgrade work.
Ethereum core developer Marius Van Der Wijden explained:
Some people only study the surface, they even think that not all features in the “Shanghai” upgrade must be implemented and tested, but the problem is that if there are 10 changes in the “Shanghai” upgrade, then each change needs to be tested individually, It also needs to test how different changes interact and affect each other, which means that once the number of functions included in the “Shanghai” upgrade increases, the testing workload will increase exponentially.
As of now, Ethereum developers have not estimated how long the Shanghai upgrade will take to implement, but Van Der Wijden believes that the Shanghai upgrade should take place within 2023. However, if Ethereum users and developers set their sights on other updates, such as danksharding, the “Shanghai” upgrade date will be delayed.
Don’t forget, there are still over $20 billion in staked ETH stuck on the Ethereum PoS chain.