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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 >>

Proof Of Stake Is Coming, And Will Be A Game Changer

Proof Of Stake Is Coming, And Will Be A Game Changer

Proof of Stake Is Coming, and Will Be a Game Changer Join our community of 10 000 traders on Hacked.com for just $39 per month. Proof of Work mining (the protocol underpinning Bitcoin and many others) uses as much energy as the nation Denmark. Its a costly and lengthy process, and with the user base growing traditional blockchains are struggling. This is because every single transaction needs to be mined by powerful computers solving complex mathematical problems. Its a process that ensures the security of the network, preventing double spends and other malicious actions. Whilst effective, the energy inefficiency of this process is truly staggering. And thats not all. With each transaction needing a lengthy confirmation process, the blockchain cannot scale easily as more and more users join the network. Bitcoin transactions are now unbearably slow and expensive, with long backlogs of transactions waiting their turn. Ethereum too is suffering from the same issue. Although the network can currently handle around fifteen transactions per second, significantly more than Bitcoin, we need only look at the recent Cryptokitties mania to see the crippling effect of high network load. Backlogs of transactions quickly built up and transaction prices skyrocketed as users fought to get included in the next block.With the severe limitations proof of work seen, it seems impossible for real-world use cases to succeed. VISA and other non-blockchains handle thousands of transactions per second, and if the many projects emerging in the crypto space are to compete, something needs to change. Vitalik Buterin, mastermind of the Ethereum system, aims to introduce what is known as a Proof of Stake this year. The upgrade to the network is known as Casper, and it promises to be a game changer. 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 >>

Ethereum Switches To Proof Of Stake

Ethereum Switches To Proof Of Stake

Recently, we posted a brief overview of the Ethereum ICO craze . Before that, we had reviewed how blockchains work in general. Today, well delve deeper into the process of mining . In this article, well introduce briefly the concepts of Proof of Work (PoW) and Proof of Stake (PoS). Well talk about why Ethereum, the second largest blockchain, is planning to switch the former for the later and share some forecasts as to the outcomes this decision might lead to. Among his many breakthrough accomplishments, Satoshi, the mysterious founder of Bitcoin, is praised for coming up with a solution to whats known as Byzantine Generals Problem. Suppose theres a war. Theres an army that has a city encircled, but due to exhaustion of resources, the armys generals are undecided whether its smarter to attack or to retreat. Suppose, also, that its the 15th century and the commanders, who are all in camps far apart, have no way of communicating effectively save for sending messengers. How could these generals (lets say there are 20 of them) reach a consensus? Obviously, theyll have to vote. If the majority (at least 51%) decides to move forward with a strategy (of attacking, or of retreating), the whole army will have to get behind their choice. Thats only fair and logical. But then theyll face another problem: how to ensure that no general involved in making a decision votes the wrong way on purpose, just to confuse things? Well, in the world of blockchains, the generals are miners. And choosing a war strategy for them is agreeing on a set of rules, a certain view of the history of digital events that are posted on the network. The way that Bitcoin enables reaching a distributed consensus and punishes, or rather discourages, bad actors for acting dishonestly is by using the Proof of Wor Continue reading >>

Proof Of Stake Faq Ethereum/wiki Wiki Github

Proof Of Stake Faq Ethereum/wiki Wiki Github

See A Proof of Stake Design Philosophy for a more long-form argument. No need to consume large quantities of electricity in order to secure a blockchain (eg. it's estimated that both Bitcoin and Ethereum burn over $1 million worth of electricity and hardware costs per day as part of their consensus mechanism). Because of the lack of high electricity consumption, there is not as much need to issue as many new coins in order to motivate participants to keep participating in the network. It may theoretically even be possible to have negative net issuance, where a portion of transaction fees is "burned" and so the supply goes down over time. Proof of stake opens the door to a wider array of techniques that use game-theoretic mechanism design in order to better discourage centralized cartels from forming and, if they do form, from acting in ways that are harmful to the network (eg. like selfish mining in proof of work). Reduced centralization risks, as economies of scale are much less of an issue. $10 million of coins will get you exactly 10 times higher returns than $1 million of coins, without any additional disproportionate gains because at the higher level you can afford better mass-production equipment. Ability to use economic penalties to make various forms of 51% attacks vastly more expensive to carry out than proof of work - to paraphrase Vlad Zamfir, "it's as though your ASIC farm burned down if you participated in a 51% attack". How does proof of stake fit into traditional Byzantine fault tolerance research? There are several fundamental results from Byzantine fault tolerance research that apply to all consensus algorithms, including traditional consensus algorithms like PBFT but also any proof of stake algorithm and, with the appropriate mathematical modeling, pr Continue reading >>

Proof Of Work Vs Proof Of Stake: Basic Mining Guide

Proof Of Work Vs Proof Of Stake: Basic Mining Guide

Proof of Work vs Proof of Stake: Basic Mining Guide Angel Investors, Startups & Blockchain developers... Recently you might have heard about the idea to move from an Ethereum consensus based on the Proof of Work (PoW) system to one based on the so-called Proof of Stake. In this article, I will explain to you the main differences between Proof of Work vs Proof of Stake and I will provide you a definition of mining, or the process new digital currencies are released through the network. Also, what will change regarding mining techniques if the Ethereum community decides to do the transition from work to stake? This article wants to be a basic guide to understanding the problem above. First of all, lets start with basic definitions. Proof of work is a protocol that has the main goal of deterring cyber-attacks such as a distributed denial-of-service attack (DDoS) which has the purpose of exhausting the resources of a computer system by sending multiple fake requests. The Proof of work concept existed even before bitcoin , but Satoshi Nakamoto applied this technique to his/her we still dont know who Nakamoto really is digital currency revolutionizing the way traditional transactions are set. In fact, PoW idea was originally published by Cynthia Dwork and Moni Naor back in 1993, but the term proof of work was coined by Markus Jakobsson and Ari Juels in a document published in 1999. But, returning to date, Proof of work is maybe the biggest idea behind the Nakamotos Bitcoin white paper published back in 2008 because it allows trustless and distributed consensus. Whats trustless and distributed consensus? A trustless and distributed consensus system means that if you want to send and/or receive money from someone you dont need to trust in third-party services. When you use tra Continue reading >>

Ethereums Switch To Proof Of Stake Better Than Proof Of Work?

Ethereums Switch To Proof Of Stake Better Than Proof Of Work?

By UseTheBitcoin in Cryptocurrency News Guides Home If youre at least interested in the cryptocurrency space, youve probably heard of Ethereum. Its currently the second largest coin by market cap, primarily because so many other tokens run on Ethereum, and partly because the development team is very talented. Either way, this post is about the switch from POW to POS. Well, POW is currently used by most cryptocurrencies including Bitcoin, Ethereum (for now) and Litecoin. If a coin is minable, that means its utilizing a POW system. Miners use their GPUs or ASICs to solve cryptographic hash functions which verify the blockchain. GPUs primarily designed for gaming like the RX 580 are now being employed by miners. Their GPUs are rapidly guessing and checking different solutions to a next to impossible math problem. When they successfully solve the equation, the ledger (blockchain) is updated and the miner receives a block reward in the form of a token and/or transaction fees. This is called Proof-of-Work because miners are doing lots of work in the form of processing mathematical equations with their mining hardware. Without miners, many networks wouldnt exist. Miners pay for electricity in exchange for tokens. What is Proof of Stake and How its different Proof-of-Stake is a bit different. Previously miners proved how fast they could verify the network; now, ETH holders will show how much they own by running something called a master node . When you create a master node, you have to lock up a certain amount of ETH to prove you own it. Rewards are distributed based on how much you have locked away and how long its locked away for. Instead of 1,000 miners verifying the network for example, there might be around 10,000 wallets holding Ethereum through Proof-of-Stake. With POS, Continue reading >>

Ethereum Proof Of Stake Implementation Launched By Applicature

Ethereum Proof Of Stake Implementation Launched By Applicature

Ethereum proof of stake implementation launched by Applicature Applicature is working on projects implying the development of smart contracts; research, deployment, and customization of blockchain solutions; technical advisory to blockchain resources; technical consultancy on token sales, initial coin offerings. Applicature , a boutique blockchain agency with a presence in the U.S and Europe has launched its Proof of Stake Consensus protocol on Ethereum in order to secure, stabilize, improve transactions in multiple industries: banking, supply chain, marketing including loyalty systems. It was developed in the fall-winter period of 2017-2018 and is ready to roll out for testing. Due to high demand from the clients, and due to already existing PoW, which wasnt always suitable to use for certain tasks, Applicature has made a decision to develop its own AEPoS (Applicature Ethereun Proof of Stake Consensus Protocol). Proof of Stake (PoS) is the blockchain consensus and reward algorithm that distributes rewards respectively to the declared economical interest in the game for example by holding of the digital assets. Such declared interest is known as stake. Proof of Work (PoW) is all about mining. To get a reward you have to solve a hard block algorithm (puzzle). The process of solving the block is called mining. All blocks must be verified by mining. It means that to validate transactions miners have to use a lot of computational power to solve the puzzle. The amount of reward you get depends on how fast you calculate. To solve the puzzle faster miners have to invest in new hardware and it burns out tons of energy. When the block is solved its added to the public blockchain. More miners mean more security. 1) Process of mining to validate transactions 2) Miners get rewarde 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 >>

Ethereum Proof Of Stake Faq | Hacker News

Ethereum Proof Of Stake Faq | Hacker News

Ethereum was supposed to have every feature under the sun from the start, proof-of-stake perhaps being the second most hyped. (Turing completeness being the clear first, which is problematic given the halting theorem and all that, so it's now rich statefullness instead.) And PoS is one of those ideas that most people looking at cryptocurrencies end up trying some variant of. PoW is obviously wasteful and it would be nice to improve on that. The problem is that it doesn't have the same properties as PoW have, and that are hard to do without. The problems are the basic ones, how to avoid colluding stakers, how to neuter the market for consumed stakes, how to deter chain splits. There is a constant flow of new coins that try various approaches, but the ones that have survived have all had to resort to some variant of checkpoints where a trusted third party decides on regular intervals which chain is valid. This has obvious implications for a supposedly trustless digital currency, where you don't really need that complicated blockchain anymore. This Ethereum PoS FAQ is much like other documentation from the Ethereum Foundation quite dense where most paragraphs introduce terms not seen elsewhere (economic finality? slashing? weak subjectivity?). If you want the interesting bit, the TL;DR, then skip to the part about weak subjectivity. Read it, and then read it again and bear in mind how other coins solved this problem. Tell me I'm wrong, but I think this bit with the key part being that the node "authenticate out of band", involve a certain third party with a Very Important Key. In which case the rest of the theory in the document doesn't matter much, does it? I'm in total agreement about the dangers here. It seems absolutely insane to institute these kind of untested chang 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 >>

When Will Ethereum Mining End?

When Will Ethereum Mining End?

In August of this year (2017), Vitalik Buterin, creator of Ethereum , released the implementation guide for the first version of Casper. As a hybrid proof-of-stake (PoS)/proof-of-work (PoW) algorithm, Casper v1 is going to decrease (and eventually end) the profitability for Ethereum miners . The release date is estimated to be sometime in 2018 as part of the Constantinople hard fork and theres a lot to learn before this happens: Casper is a PoS algorithm thats projected to be released on the Ethereum network sometime in 2018. Beginning as a hybrid with the current PoW algorithm, the first version of Casper will only use a PoS consensus to validate every 100th block, called checkpoints. Once a checkpoint is validated, theres no way to go back and use a chain without it. Even if 99% of miners support a chain that doesnt include a checkpoint block, all clients in the network will still continue to use the one with the checkpoints. This removes a lot of the power that miners currently have. The Ethereum community hypothesizes that the switch to PoS will help with the scaling issues that the network is currently facing. The algorithm should enable new blocks to be created more quickly while allowing the network to scale more efficiently through sharding. Sharding is a horizontal partitioning of a large database into smaller and more easily managed parts. Beyond that, PoS algorithms also use less energy to run the network, reduce centralization, and make 51% attacks more difficult. With the upcoming hard fork, there could potentially be three forks of Ethereum: And, if youre a miner, you may be thinking, No big deal, Ill just continue to mine and give support to the Ethereum PoW fork. The Ethereum developers have stated that theyll be releasing what they call the difficulty Continue reading >>

How Ethereum's Casper Protocol Will Address Problems With Proof Of Stake

How Ethereum's Casper Protocol Will Address Problems With Proof Of Stake

How Ethereum's Casper Protocol Will Address Problems With Proof Of Stake Bitcoin and Ethereum both currently operate under a Proof of Work protocol. Ethereum is moving from Proof of Work towards Proof of Stake under its new Casper protocol. Despite its many benefits, the drawbacks of Proof of Stake have prevented its widespread adoption. Casper aims to solve Proof of Stake's drawbacks, resulting in an improvement over existing Proof of Work and Proof of Stake protocols. The updated protocol improves the long term outlook of Ethereum's valuation. An overarching problem that cryptocurrencies must address is called the Byzantine General's Problem . The Byzantine General's Problem essentially simplifies down to: How do you prevent data from being corrupted or falsified in a network where there are nodes that have economic incentive to lie about the data? In application to cryptocurrency, the problem boils down to preventing attackers from lying about a coin's ledger, given the economic incentive of doing so. We need a way to form consensus on the ledger because anyone can create a block, while we only want a unique chain, so we want a way to decide which block to trust. The two main schools of thought to solving the Byzantine General's Problem are Proof of Work (PoW) and Proof of Stake (PoS). Explicitly, a "proof of work" is a piece of data which is difficult (costly, time-consuming) to produce but easy for others to verify and which satisfies certain requirements. Producing a proof of work can be a random process with low probability so that a lot of trial and error is required on average before a valid proof of work is generated. Currently Bitcoin, Ethereum, and the vast majority of other cryptocurrencies utilize some form of proof of work. PoW (referring to the protocol Continue reading >>

Will Ethereum Be Worth Staking?

Will Ethereum Be Worth Staking?

By Ethereum ( ) [CC BY 3.0 ( )], via Wikimedia Commons Ethereum is switching to Proof of Stake as soon as early 2018. The Casper protocol has been formalized, the specification is complete, and now the implementation phase can begin. Depending on how long it takes to implement and test may determine how it all plays out. The question is will it actually be worth it to stake Ether in the first place? Will people be able to do it securely? I have my doubts that individuals will be able to securely stake if we are talking large amounts of Ether (1000+) because the price of 1000 Ether could reach into the millions of dollars. There may be attempts to decentralize this with staking pools but again the question remains whether or not people will think it's worth it to stake? What amount of interest from staking would it take to be deemed worth it? In my opinion it has to be over 6%. The federal reserve gives 6% dividends to all banks who are a member so if the federal reserve operates in this fashion then it's a very similar structure to the federal reserve. At the same time inflation exists so if the interest from staking isn't high enough people would be foolish to bother and this is where things are most concerning. In stocks a person can get around 8% yearly growth in value along with 4-5% annual dividends. So why would someone choose Ether over stocks? A company might choose Ether for political reasons but why would an individual investor choose a naturally high risk investor to park their wealth? Finally a website is available which tracks all our trades for tax purposes. Cointracking.info has the most features of any similar service. I recommend it for people who want to earn their money and keep it without having to look over their shoulder. Sign up with my link to g 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 >>

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