Source: https://www.listennotes.com/podcasts/epicenter-learn/danny-ryan-ethereum-dNF42A7tuiR/
Notes
- Eth 2
- Beacon chain went live in Dec 2020
- 4.5m eth locked
- Each validator 32 eth
- Validator job: randomness generation, finality, validator level transactions (attestations, deposits, onboarding)
- The Merge
- Eth1 has an application layer and a thin consensus layer (PoW)
- Post merge - beacon chain will drive applications going forward
- Eth2 keeps everything about Eth1 clients and swaps out the consensus
- Why not fork?
- difficulty bomb
- applications atop Eth are much more substantial now
Transcript
[00:00:00] swyx: This week, we're diving into Ethereum and other cryptocurrencies. Don't worry, this isn't about to become a cryptocurrency podcasts, but I still think it's a pretty interesting topic. And there's a lot of interesting research that is not just price hype, but actually serious innovation in terms of distributed systems and crypto economics.
[00:00:19] And I've been storing up a bunch of podcasts related to that, that I figured I would get through it now in one block.
[00:00:25] So today I wanted to feature this conversation on the epicenter podcast with Denny Ryan, Danny is from the foundation and works on Eve too. And he explains what these two is what the merge is going to be like as well as what the incentives are for the community to stick together rather than have hard fork like they did last time with Eth classic.
[00:00:43] Danny Ryan: Eth2 is a series of major consensus upgrades for Ethereum aimed to make the protocol more secure, more sustainable, and more scalable. And at the core of that is the move from proof of work consensus to a proof of stake consensus.
[00:01:00] So instead of securing the network with mining hardware and energy consumption, securing the network with the tokens itself the ether. And so at the core of that is the bootstrapping and the creation of this new consensus mechanism. And what as you mentioned, is live today is what we call phase zero.
[00:01:18] And that went live in December of 2020. And that was really the bootstrapping of this new proof of stake consensus mechanism. That is called the beacon chain. So in December tons of Ethereum community members and different institutions put a bunch of ether as capital and collateral into what we call the deposit contract and kickstarted this new consensus mechanism called the beacon chain.
[00:01:42] The beacon chain exists in parallel to the current theater network. So in parallel to the proof of work network, which is still securing all of the assets and applications and contracts and accounts today. So we have on the one hand and the proof of work network chugging along and on the other hand, this new consensus mechanism called the beacon chain existing in parallel to this building and securing it.
[00:02:07] I think today there's something like 4.5 million ether locked and secured in this chain. I don't know what that's worth today. It depends on the minute and the hour. This thing exists, this thing finalizes itself, this thing builds itself. But ultimately what it does is it just builds and secures itself.
[00:02:26] And this is by design. This is an iterative path to get rid of the proof of work and to move Ethereum to this new consensus mechanism, obviously it, there may not as used by tons of people secure as tons of value. And there's a lot at stake in this operation. But what we've done is built it in parallel vetted it in production dozens, tons of tests live.
[00:02:49] And now what we're working on is actually the deprecation of the proof of work consensus mechanism in favor for the slide proof of stake consensus mechanism. So that's where we're at today. There is a proof of stake, consensus mechanism, bootstrapped live securing tons of value, but really just securing itself in isolate.
[00:03:07] Martin Köppelmann: Then let's deep dive into what it exactly does. So, right now it comes to consensus on what?
[00:03:13] Danny Ryan: It comes to consensus on itself and it's by itself. What I mean is the proof of stake, consensus mechanism and all of the little gadgets and things in it. So it has a validator set. Each validator is worth approximately 32 eith.
[00:03:26] So there's something like 140,000 validator entities in this consensus. Each one of them has like its own little state. It has its balance. It has duties. It has like a job at any given time. It has randomness generation. It has information about finalities. So which portions of the chain are finalized and will never be reverted.
[00:03:47] And it has a lot of just various accounting between finality and kind of the head of the chain. So there's a number of operations related to the functionality of this chain. And those operations are what we call validator level transactions. So system level trends. And really what it does is there's a core operation called attestations where validators are constantly signaling what they see as the head of the chain and what they see as their local state of the world.
[00:04:14] And they use these messages to come to consensus with each other and ultimately drive this core like system layer of the chain. There's some other operations related to validate or activity like deposits, onboarding, new validators exits leaving the validator set, and a couple of other things.
[00:04:30] So really it's like this, it's a proof of stake system and there's a lot of different accounting, different little operations going on and it builds and it comes to consensus on itself. So
The Merge
[00:04:39] Friederike Ernst: maybe let's talk about the merge for a little bit. There would be the merge and the merge with merge each one into the beacon chain. So how exactly does it happen? When is it going to happen? I imagine either one in east who have separate states, how is that handled? How do you make them congruent?
[00:04:55] Danny Ryan: So let's think about what Eth1 is. Eth1 is, and this is a construction for each. One's a lot of things, and there's a lot of different ways to think about it.
[00:05:04] But for the purposes of the merge, we can think about it in two layers, we have this application layer or this execution layer where all of the users hang out. It's where all the applications are. It's where the user layer state is. It's where transactions are being processed. Right. It's really like what I, as an end user care about, I care about, you know, my unit swap trades and that kind of stuff.
[00:05:27] And then you have this thin purple work consensus module that's driving. It's really like providing the services, providing the quality the it's riding the service to this execution layer. It's the cradle for blocks. It's providing guarantees about reorgs and different things like that.
[00:05:42] And what we have is really these two layers. We have the preferred consensus layer providing the application layer to services and to users. And then what we've bootstrapped in production today is the beacon chain, which is a proof of state...