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Impact of Ethereum upgrade on DeFi
Ethereum (ETH), the second-largest cryptocurrency by market capitalization, is expected to launch its much-anticipated ETH 2.0 upgrade in the second half of 2020. The upgrade marks a major shift for the blockchain network as it switches its consensus mechanism from (PoW) to (PoS) in a bid to improve scalability and introduce new features.
Also known as Serenity, According to the original plan, there are 4 phases of the upgrade (phase 0-3). While Phase 0 was scheduled for 2019 and Phase 3 was expected to be completed by 2022, the launch has been delayed multiple times due to changes in the governance structure of the core development team.
“A high technical bar prevented many users from participating in the network but companies supporting ETH 2.0 with turnkey solutions like Alchemy make staking as quick. This is critical in securing the network with a massive, diverse and decentralized validator group to guarantee security and resilience for the next 100 years and more!”
$DeFi solutions to become more competitive
Decentralized Finance has a prominent place in the Ethereum ecosystem, accounting for 60 percent of the total value of Ethereum DApps as of May 2020. At the time of writing, over 2.5 million ETH (over $600 million) are locked in DeFi DApps, and the number can be expected to grow as users seek alternatives to traditional financial services.
However, scalability remains a stumbling block when decentralized finance applications are compared with their traditional counterparts, such as the Visa network, which can process thousands of transactions per second (tps). Currently, the Ethereum network is limited to less than 50 tps at best.
The ETH 2.0 upgrade allows developers to make scalability gains with technological implementations like sharding, which are expected to dramatically increase the number of transactions per second on the network. This could bring DeFi apps in line with traditional solutions.
#DeFiChallenge #DeFiEthereum2.0
Impact of Ethereum upgrade on DeFi
Ethereum (ETH), the second-largest cryptocurrency by market capitalization, is expected to launch its much-anticipated ETH 2.0 upgrade in the second half of 2020. The upgrade marks a major shift for the blockchain network as it switches its consensus mechanism from (PoW) to (PoS) in a bid to improve scalability and introduce new features.
Also known as Serenity, According to the original plan, there are 4 phases of the upgrade (phase 0-3). While Phase 0 was scheduled for 2019 and Phase 3 was expected to be completed by 2022, the launch has been delayed multiple times due to changes in the governance structure of the core development team.
“A high technical bar prevented many users from participating in the network but companies supporting ETH 2.0 with turnkey solutions like Alchemy make staking as quick. This is critical in securing the network with a massive, diverse and decentralized validator group to guarantee security and resilience for the next 100 years and more!”
$DeFi solutions to become more competitive
Decentralized Finance has a prominent place in the Ethereum ecosystem, accounting for 60 percent of the total value of Ethereum DApps as of May 2020. At the time of writing, over 2.5 million ETH (over $600 million) are locked in DeFi DApps, and the number can be expected to grow as users seek alternatives to traditional financial services.
However, scalability remains a stumbling block when decentralized finance applications are compared with their traditional counterparts, such as the Visa network, which can process thousands of transactions per second (tps). Currently, the Ethereum network is limited to less than 50 tps at best.
The ETH 2.0 upgrade allows developers to make scalability gains with technological implementations like sharding, which are expected to dramatically increase the number of transactions per second on the network. This could bring DeFi apps in line with traditional solutions.
#DeFiChallenge #DeFiEthereum2.0
