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How Ethereum Casper Works

How Does Ethereum's Casper Proof-of-stake Protocol Work?

How Does Ethereum's Casper Proof-of-stake Protocol Work?

How does Ethereum's Casper proof-of-stake protocol work? Casper is a security deposit based economic consensus protocol. It is intended to replace the current Proof-of-Work algorithm used by Ethereum. Why are they creating a new Proof-of-Stake(PoS) protocol? The Ethereum developers want to address the flaws with the existing PoS protocols. The main reason they are developing this algorithm is the "nothing at stake problem." The idea behind it is that validators are not being punished if they start forking the chain for their own gains. With the existing protocols if the chain splits the validators will not get fined if they continue validating blocks on both chains. Why would they do that? It is a simple backup plan. If you mine on both chains, you are likely going to gain more money/tokens/coins from that. What Casper does is that it forces validators to deposit a certain amount of tokens and these tokens would serve as collateral. If you do not play by the rules, you will lose your money. Secondly, Casper introduces a new consensus rule where validators bet on the future outcome of the blockchain. The bets are placed from the provided deposits. The math behind all of this ensures that the highest bet on the future outcome will be the actual outcome. If a validator bets with high probability on a different outcome he/she will lose their deposit. Casper is a cooperative consensus algorithm where in order to get maximum revenue as a validator you need 100% of all validators to be online or follow the same rules. As a validator, it is in your best interest to play by the rules. Continue reading >>

Ethereum Price: What The Casper Update Means For Ethereum

Ethereum Price: What The Casper Update Means For Ethereum

Ethereum price: What the Casper update means for Ethereum Ethereum is on a charge right now after the first testnet of a major update was released. Here's what it means. Ethereum , while many believe is the future of the internet, in its current form still has problems handling capacity, relies on miners for proof of work and is quickly becoming more expensive for transactions. List of exchanges that allow you to buy Ethereum In December, the increasingly popular Ethereum-based game CryptoKitties brought in so much traffic that it completely overwhelmed the Ethereum network for 24 hours. There are several improvements on the roadmap to eventually bring Ethereum to the point where it can handle as many transactions per second as the Visa network, decentralised and at a cheaper price. The first of these is known as the Casper update, and its initial test network was just released, which is why Ethereum's price has been going through the roof. Casper, once it's integrated will turn Ethereum from a Proof of Work platform into a Proof of Stake, which will make everything much faster and cheaper as it continues to grow. Currently, the Proof of Work system Ethereum uses means miners are needed to solve complex algorithms to support consensus and keep the network running. In the Proof of Stake world, these miners will be replaced by "Stakers". These Stakers will stake their coins in special wallets, and be paid dividends from network fees based on how much ETH they stake. Stakers will need to have a minimum amount of ETH before they can take part in the consensus. It's not sure yet how much ETH will be needed, however Ethereum founder Vitalik Buterin has said it could be around 1,000 to begin with. The biggest change which will come from this is that it will make Ethereum mine Continue reading >>

Ethereum Launches Casper Testnet, Paving The Way For Proof-of-stake

Ethereum Launches Casper Testnet, Paving The Way For Proof-of-stake

Ethereum Launches Casper Testnet, Paving the Way for Proof-of-Stake Ethereum developers have launched an alpha test network (testnet) for Casper, paving the way for the cryptocurrency to eventually transition to a proof-of-stake (PoS) consensus algorithm. Like bitcoin, ethereum currently operates on a proof-of-work (PoW) consensus algorithm, meaning that the network is secured and new currency units are issued through mining, whereby participants solve cryptographic puzzles to validate transactions and create new blocks. However, PoW has attracted criticism over the years, both for its tendency to centralize mining hardware into a few pools and for the amount of electricity it consumes. Ethereum aims to address these problems by transitioning to Casper , a proof-of-stake (PoS) consensus algorithm. Under Casper, participants can become validators by locking up or staking ether. Validators will take turns proposing and voting on blocks, and both the weight of their votes and the size of their rewards will hinge on the size of their stakes. According to developers, moving to Casper will greatly reduce the amount of electricity wasted through PoW mining. In addition to limiting its environmental impact, PoS will allow ethereum to dramatically reduce its rate of currency inflation since validators will have much lower overhead and will thus require smaller rewards to incentivize them to continue to serve as validators. Moreover, PoS will also reduce the incentive that validators have to centralize their influence. With decreased centralization comes increased security and, importantly, resistance to dreaded 51 percent attacks. Ethereum is not the first project to attempt to integrate a PoS consensus algorithm. However, most previous PoS implementations have been criticized Continue reading >>

Alpha Casper Ffg Testnet Released, Ethereums Pos Excitement Grows

Alpha Casper Ffg Testnet Released, Ethereums Pos Excitement Grows

Ethereums march toward Proof of Stake (PoS) continues, as researcher Karl Floersch has just released a guide on how to use an alpha Casper FFG testnet through pyethereum. The testnets parameters which are not finalized currently require 1,500 ETH as a minimum staking amount. Join the Bitsonline Telegram channel to get the latest Bitcoin, cryptocurrency, and tech news updates: ETH Community Continues March Toward Casper In what many Ethereum users will consider a symbolic cap to a strong year, Floersch released the Alpha Casper FFG Testnet Instructions earlier this morning on 2017s final day. There are two versions of Casper Ethereums researchers are currently working with: Casper FFG (Friendly Finality Gadget) and Casper CbC (Correct-by-Construction). The former model, which Floerschs freshly released testnet is based off of, will manage Ethereums shift from Proof of Work (PoW) to PoS. Likewise, Casper CbC will be used to manage Ethereums consensus process after the shift to PoS has been finalized. When over, this transition will allow Ethereum users to stake ether to validate the network, as opposed to the mining thats currently required through PoW. For users interested in taking the new FFG testnet for a spin, its only available for now through the pyethereum client. In his guide, Floersch was careful to keep expectations realistic, noting that: pyethereum [] has a much lower processing capacity than clients implemented in faster languages; as a result, network parameters will be heavily restricted to ensure network sustainability.Do not expect performance equivalent to test networks operated by more performant clients such as Geth and Parity. The researcher also explained how prospective participants could become test validators: First, you will need to have enough Continue reading >>

Consensus - How Does The Casper Proof Of Stake Algorithm Work? - Ethereum Stack Exchange

Consensus - How Does The Casper Proof Of Stake Algorithm Work? - Ethereum Stack Exchange

How does the Casper proof of stake algorithm work? Ethereum plans to move to the Casper proof of stake algorithm in a future version of the network. What are the details of that algorithm, and how does it compare to previous Proof of Stake consensus protocols? note that unlike this question I'm asking purely about casper itself, not about why ethereum might or might not want to use casper (or another proof of stake algorithm). Jeff Coleman Jan 20 '16 at 20:15 Possible duplicate of What is casper? Murch Jan 24 '16 at 9:17 how can i participate in stake by having funds on ethereumwallet/mist and let it run 24/7? dr john Dec 26 '16 at 13:43 Casper is a security-deposit based economic consensus protocol . This means that nodes, so called bonded validators, have to place a security deposit, an action called bonding, in order to serve the consensus by producing blocks. In Casper style proof of stake anyone can participate in block production by posting a bond. After posting a bond you have an opportunity to bet on which block will be included next. The incentives are such that you make money by betting with the eventual consensus and lose money by betting against the consensus. Any crypto-graphically provable misbehavior results in the forfeit of the bond. An analogy can be made to proof of work where each miner is betting with their hash power on which block will be accepted. If they bet wrong then any block they produce will be orphaned causing them to lose money. This protocol has several nice properties: Consensus can be reached in a timely manner It quickly converges on an irreversible consensus Casper is an eventually-consistent blockchain-based consensus protocol. It favours availability over consistency, see the CAP theorem . It is always available, and consistent wh Continue reading >>

Ethereum's Casper Is Almost Here, Here's What You Need To Know - Influencive

Ethereum's Casper Is Almost Here, Here's What You Need To Know - Influencive

For those unfamiliar with blockchain platform Ethereum , it currently runs on Proof of Work (PoW) consensus. The result is a lot of hardware and electricity is needed to confirm a transaction through a process called mining, or searching for the next block on the chain (hence blockchain.) Many are still unaware of the future of Ethereum,Casper, the friendly ghost. No thats not what it is, Casper is the new consensus strategy that Ethereum will run on once it is implemented. Casper uses the Proof of Stake (PoS) algorithm, which requires much less computational power to find the correct block. Proof of Stake differs in a way that nodes place a stake, similar to a security deposit to validate transactions. If they bet with the consensus they are likely to be rewarded, while betting against the consensus can result in a loss. The amount of influence that any given coin holder has is proportional to the amount of coins they hold (stake). Now after all that, you may ask why is Casper so important? Well, currently the Ethereum network can handle 10 to 20 transactions (txns) a second, which means the network can get bogged down quite easily, especially when an Initial Coin Offering (ICO) is going on. Anyone who was trying to send Ether during Bancors ICO back in June noticed that lots of transactions were not getting through due to the sheer volume of people trying to send Ether for the ICO. Vitalik Buterin (Co-founder of Ethereum) has spoken about how the network needs improvement. Here is a quote from him: the applications are thereall are on backburner now precisely because scalability is not there. I personally have cut down evangelism precisely because I see that the main bottleneck is now not interest, but tech. Switching to Casper will allow Ethereum to scale in order t Continue reading >>

Seeing Ghosts: Vitalik Is Finally Formalizing Ethereum's Casper Upgrade - Coindesk

Seeing Ghosts: Vitalik Is Finally Formalizing Ethereum's Casper Upgrade - Coindesk

Seeing Ghosts: Vitalik Is Finally Formalizing Ethereum's Casper Upgrade Casper is starting to look less like a ghost. While that might sound too good to be true for the long-waiting ethereum faithful, CoinDesk has confirmed that the network's creator, Vitalik Buterin, is now in the process of crafting three white papers explaining Casper, the protocol's much-anticipated version of proof-of-stake consensus. As such, the papers could come to mark a major milestone for ethereum in that, while Casper has long been proposed as a better and greener way to keep the global network in agreement about the blockchain's transaction history, the industry has been waiting for details to be put on paper. Rather, the idea has been trapped in the brains of a few ethereum developers, with breakthroughs and development scattered across online chat groups and blog posts over the last several years. As proof-of-stake is pitchedas sucha crucial piece of ethereum, users have had to trust these developers do indeed have a good plan. As such, Buterin's formal white papers will now subject ethereum developers to peer-review, which could mark a big step forward for the project which is currently getting ready to upgrade to Metropolis before changing the system over to proof-of-stake. "In short, the Casper designs are getting better each iteration," ethereum developer Virgil Griffith, a well-known hacker and ethereum developer who is currently reviewing Buterin's white papers, told CoinDesk. The papers have been hiding in documents in the ethereum research GitHub for the last couple of weeks, with Buterin and Griffith making updates every now and then. However, it's worth noting the early-stage nature of the work. The documents, which have question marks and some "coming soon!" bubbles scattered Continue reading >>

First Impressions Of Ethereums Casperproof Of Stake(pos)

First Impressions Of Ethereums Casperproof Of Stake(pos)

Vitalik Buterin and Virgil Griffith have introduced a proof of stake-based finality system capable of overlaying an existing proof of work (PoW) blockchain. In their paper [1], entitled Casper the Friendly Finality Gadget, Buterin and Griffith explain that the first version of Casper (within Ethereum) could take on the form of a hybrid PoW/PoS system. The first available release of the alpha Casper Friendly Finality Gadget (FFG) testnet, built on pyethereum, achieves this. This hybrid PoW/PoS vision, albeit with only 14 listed nodes at the time of writing, can be observed on the following Ethereum Network Status Site [2]. Installing Casper FFG on Ubuntu 16.04LTS Thankfully, the process of installing Casper FFG on Ubuntu as documented here [3] is relatively straight forward. This succinct installation process is thanks to the docker approach provided by Karl Floersch [4]. Participating in the validation PoSprocess At present, my most significant hurdle to running a validating Casper FFG testnet node is not brought about by the installation process or commands. It is brought about by the fact that a validating Casper FFG node, on the testnet, must provide a minimum deposit of 1, 500 Casper FFG testnet ETH in order to participate in the validation process. As we mentioned previously, Casper FFG is a hybrid PoW/PoS system and therefore the Casper FFG node is able to be run in mining mode. The following gist contains a list of commands for mining Casper FFG testnet ETH using Ubuntu 16.04LTS. The following gist contains a list of commands for checking Casper FFG testnet ETH account balance (during/after mining). Of course, whilst mining is an option, it would be ideal if participants willing to try out the alpha Casper FFG testnet could have immediate access to the required Continue reading >>

Casper Pos - How Will It Work? : Ethereum

Casper Pos - How Will It Work? : Ethereum

Welcome to r/Ethereum , the front page of the Web 3. No inappropriate behavior. This includes, but is not limited to: personal attacks, threats of violence, gossip, slurs of any kind, posting people's private information. Keep price discussion and market talk, memes & exchanges to subreddits such as /r/ethtrader Keep plain ICO advertisements to subreddits such as r/ethinvestor . Keep mining discussion to subreddits such as /r/EtherMining . No creating multiple accounts to get around Reddit rules. English language only. Please provide accurate translations where appropriate. Posts and comments must be made from an account at least 10 days old with a minimum of 20 comment karma. Exceptions may be made on a discretionary basis. Continue reading >>

Lightning Network For Ethereum? Eth Surges As Casper Approaches

Lightning Network For Ethereum? Eth Surges As Casper Approaches

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What Is Ethereum Casper Protocol? Crash Course

What Is Ethereum Casper Protocol? Crash Course

What is Ethereum Casper Protocol? Crash Course Angel Investors, Startups & Blockchain developers... If you are interested in Ethereum or Cryptocurrency in general, then you must be aware of the terms proof-of-stake and Ethereum Casper. There is no running away from these terms, they are everywhere. Now because there is so much data out there, anyone interested in the topic may go through paralysis via analysis. So, in this guide, we present to you the definitive guide to Casper and how it will change Ethereum forever. What is Ethereum Casper Protocol? Crash Course Most cryptocurrencies including Bitcoin run on proof-of-work. Proof-of-work as a process has the following steps to it: The miners solve cryptographic puzzles to mine a block to add to the blockchain . This process requires an immense amount of energy and computational usage. The puzzles have been designed in a way which makes it hard and taxing on the system. When a miner solves the puzzle, they present their block to the network for verification. Verifying whether the block belongs to the chain or not is an extremely simple process. That, in essence, is what the proof-of-work system is. Solving the puzzle is difficult but checking whether the solution is actually correct or not is easy. This is the system that Bitcoin and Ethereum (till now) have been using. However, there are some fundamental flaws in the system. As it turns out, there are quite a few problems with proof-of-work. First and foremost, proof of work is an extremely inefficient process because of the sheer amount of power and energy that it eats up. People and organizations that can afford faster and more powerful ASICs usually have a better chance of mining than the others. As a result of this, bitcoin isnt as decentralized as it wants to be. Continue reading >>

Update On The Ethereums Casper Pos Hybrid And Sharding

Update On The Ethereums Casper Pos Hybrid And Sharding

All seems to be going well for development at the worlds second most valuable cryptocurrency. The team at the Ethereum foundation is actively busy testing the latest featured of the Metropolis upgrade . One of the most important of these features was the movement from Proof-of-Work mining to Proof-of-Stake. Ethereum has been working on a hybrid between the two solutions that has aptly been named the Casper POS protocol . This has been on the Testnet and has been running for a few weeks already. According to Vitalik Buterin who is the founder of Ethereum: The Casper aspect of Casper, where two conflicting blocks should not be able to be finalized, seems to actually happen running and the network agrees all along what the final chain is Although the Casper Hybrid has been running in the testing environment, it has not been without a few problems. Apparently the nodes losing their connection and get floods of new connections so the developers have had to institute clever hacks to get around this. This means that the Ethereum developers will have to complete quite a bit more testing before there can be any sort of live implementation of the protocol. However, according to Buterin it seems as if the most important part of the upgrade is indeed effective. This is the manner in which conflicting nodes are able to reach a network consensus. With the minor reconnection issues corrected, it is entirely possible that we could see Casper hitting the Mainnet by the middle of the year. There has also been quite a lot of work that has been done on the sharding side. This is arguably one of the most important updates to blockchain technology ever as it aims to markedly decrease transaction times. Blockchain sharding uses parallelisation of blockchains. This will eliminate the ineffici Continue reading >>

Introduction To Ethereums Casper Proof-of-stake

Introduction To Ethereums Casper Proof-of-stake

With Ethereums DevCon 3 starting today in Cancun, Mexico, developers from around the world will be asking questions about the future of Ethereums blockchain. One upgrade that will be under the spotlight is the much-anticipated switch from the current Proof of Work consensus algorithm to Proof of Stake (PoS). In development since 2013, the Casper PoS solution by founder Vitalik Buterin and Ethereum developer Vlad Zamfir is almost complete and can see a potential release, as early as the second part of the Metropolis HF , Constantinople. Traditional Proof of Stake (PoS) is a consensus algorithm that allows wealthy participants of a network to validate blocks by staking or locking up their coins. In a Proof-of-Work (PoW) consensus system, the algorithm rewards miners (Block Reward) who solve complex cryptographic puzzles which create new blocks and validate transactions. In a Proof-of-Stake consensus system, the creator of a new block is chosen depending on the amount of coins they have locked up (Stake) and there are no block rewards in this system. Instead, Validators earn the transaction fees. But what happens if the wealthiest validators try to cheat or reverse transactions? Enter Vitaliks Casper PoS solution. The key difference between traditional proof-of-stake consensus systems and the Casper PoS is that validators can be punished for not following the rules and trying to validate malicious blocks. Think of it as a bet. If your stake is 1000 ETH, then youre essentially betting 1000 ETH that the next block to be included, is valid. However, if it is a bad transaction/block then you will lose your stake and be removed from the validators pool. According to Vitalik, anyone can join as a validator, as long as they have enough ETH to deposit/stake into the Casper Smart Continue reading >>

Beginner's Guide To Ethereum Casper Hardfork: What You Need To Know

Beginner's Guide To Ethereum Casper Hardfork: What You Need To Know

The Casper updates mission is straightforward, then: to shift ether from being a PoW coin to a Proof-of-Stake (PoS) coin . As opposed to the PoW consensus protocol, the PoS protocol achieves consensus through stakerssometimes referred to as minters, toowho stake their coins by locking them down in specialized wallets . With these stakers at work, mining will become redundant, meaning the Ethereum network post-Casper will rely on stakers and staking pools instead of miners for its operability. And, like miners, stakers will be rewarded for their service to the network. Minters will receive an annual dividend of ether (collected from network fees), so staking would be a lucrative endeavor for those with enough coins. Naturally, then, the more ETH you stake, the larger your annual dividends will be. For now, Ethereums developers havent arrived at a hard number for the amount of ETH that will be required to stake. What they have confirmed, though, is that the number will likely start out higher before gradually being brought considerably lower. For instance, Ethereum founder Vitalik Buterin has recently thrown around a guesstimate of needing approximately 1,000 ETH to be one of the networks inaugural stakers. He said that number could be dropped down to as low as 10 ETH over time. Whatever the number ends up being, users will still be able to band together and create staking pools, just like there are robust mining pools in the Bitcoin and Ethereum communities today. Youll simply pitch your desired amount of ether in, lock in down with your peers, and rake in the dividends together (to be shared proportionally, of course). Well, the Casper update is certainly a team effort, but its inarguable that top Ethereum researcher Vlad Zamfir has been at the vanguard of the updates Continue reading >>

Lightning Network For Ethereum? Eth Surges As Casper Approaches

Lightning Network For Ethereum? Eth Surges As Casper Approaches

Lightning Network For Ethereum? ETH Surges as Casper Approaches Lightning Network For Ethereum? ETH Surges as Casper Approaches As Bitcoin calms down after its latest roller-coaster ride, Ethereum has soared to unprecedented heights. The coin briefly peaked at just over $900 on January 2nd, and appears to be heading back up and beyond following a brief dip at the time of press. 2017 was a year of eye-popping growth for the cryptocurrency markets at large, and the rise of Ethereum was undoubtedly one of the most significant parts of the crypto journey throughout the year. According to Ethereums official blog, transactional volume on the ETH blockchain has more than doubled within the last several months. The network has reportedly processed an average of ten transactions per second for periods lasting as long as a few days. While ten tx/second may not seem to be much compared to the 24,000 tx/second capabilities of the Visa network, its more than double the average Bitcoins 4 tx/second. Ethereum also reported that the number of accounts created per day passed 100,000 as well as an increase of nodes (computers that uphold a blockchains network) despite rising system requirements. While much of Ethereums rise throughout the year can be contributed to the blossoming era of ICOs and several regulatory measures that legitimized Ethereum as legal tender in several countries throughout the world, the most recent rise could be attributed to the approaching Casper software update that will improve security and scalability on the Ethereum network. Although Bitcoins scalability issues have received quite a bit more publicity than Ethereums, implementing a scalability solution for the Ethereum network has become an increasingly urgent task as the network supports a growing number o Continue reading >>

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