Purpose of Ethereum 2.0
The primary goal of the Ethereum 2.0 update is to improve scalability so that the network can process more transactions without delays or high fees.
While the full effects of the update won’t be felt until it’s fully rolled out, some of the potential use cases for Ethereum 2.0 include:
- Supporting the large-scale adoption of blockchain technology by private and corporate businesses;
- Creating more decentralized autonomous organizations (DAOs) and governance models based on smart contracts and trustless interactions;
- Ethereum token launches that allow new projects to fundraise and launch their own tokens on the Ethereum network;
- The further expansion of nonfungible tokens (NFTs) and other digital assets that can be stored on the Ethereum blockchain; and
- Enhanced support for decentralized financial (DeFi) platforms and DApps is expected to be widely adopted by crypto enthusiasts and the wider public.
In addition to these benefits, it is also likely that Ethereum 2.0 will enable a variety of new use cases that are not possible on the current network, such as:
- Distributing tokens representing property rights as a method of managing royalties in the music industry;
- Creating a decentralized AI (artificial intelligence) ecosystem that allows users to train and monetize their own machine learning models;
- Facilitating secure and cheap cross-border payments;
- Enabling supply chain managers to track product delivery without fear of tampering;
- Providing a decentralized platform for gaming and predictive markets; and
- Increased privacy and the capacity to store large amounts of data, which can be especially useful for storing sensitive information such as medical records and financial records.
While there is still time before the update is fully rolled out, the benefits it promises to bring are significant and could have a major impact on how businesses and individuals use blockchain technology in the future.
The popularity of the Ethereum platform
The popularity of the blockchain network is expected to grow once Ethereum 2.0 is released.
Ethereum 2.0 provides greater scalability, security and efficiency for businesses and individuals looking to take advantage of blockchain technology. Ethereum is currently one of the most well-known cryptocurrencies, next to Bitcoin (BTC), with nearly 4 million wallets active in ETH as of February 2022.
The blockchain continues to be where most of the DeFi and NFT activities take place, with new DApps and projects being launched on the platform every day. According to analysts, Ethereum currently holds 70% of all DeFi transactions in the cryptocurrency market and the blockchain is used to support most NFT and gaming projects.
The number of transactions on the Ethereum network
The average number of transactions on the Ethereum network is currently 1.1 to 1.5 million transactions per day.
These numbers are expected to grow exponentially after the launch of Ethereum 2.0 as it will allow significantly more transactions to be processed per day. Currently, the network can only handle 15 transactions per second.
Ethereum 2.0 aims to increase this exponentially to around 150,000 by the time the upgrades are fully rolled out. If this becomes a reality, Ethereum will undoubtedly become one of the fastest and most scalable blockchains in existence, which should further increase its popularity.
Addressing scalability and high gas costs with Ethereum 2.0
Scalability has always been one of Ethereum’s biggest challenges. This is especially true for developers looking to build DApps and DeFi platforms on the blockchain, as transaction costs can be prohibitively high.
With the launch of Ethereum 2.0 (which introduces a new PoS consensus mechanism and shard chains), it will finally be possible to scale the network in a way that significantly reduces costs and enables faster transactions:
Tips and Tricks to Spend Less Gas Costs on Ethereum
There are several ways you can reduce or even eliminate these costs when you spend money on gas charges on Ethereum.
- Use wallets that support batching: Batch processing is a feature offered by some wallets that allows you to group multiple transactions into one, saving you gas.
- Use ERC20 Tokens: ERC20 Tokens are digital assets that run on the Ethereum blockchain and can be used in place of ETH when paying for gas. This is because they often have much lower transaction costs than ETH itself.
- Use a gas price calculator: Gas prices fluctuate often, so it’s important to use a gas price calculator to ensure you get the best possible price for your trade.
- Use a gas tracker: A gas tracker is a tool that allows you to monitor real-time gas prices on the Ethereum network. This can ensure that you are always aware of the latest prices.
- Use a gas station: A gas station is a website where you can compare the gas prices of different ETH wallets to find the best one for your needs.
By following these tips, you can significantly reduce the amount of money you spend on gas when using Ethereum. This will make it more affordable for you to use the network and participate in DeFi and other activities until Ethereum 2.0 is fully launched.