The second largest cryptocurrency has had a very difficult year on the one hand (a decrease of about 70%), but a fruitful year (The Merge). In addition, Ethereum shows great relative strength against other projects. Some experts even predict that within a few quarters ETH may overtake BTC in terms of capitalization.
Table of Contents
Additional supply of Ethereum is imminent
This will be the most pressing issue Ethereum developers will face.
After the September Merge, when Ethereum changed its consensus mechanism to Proof of Stake (PoS), the network started using validators instead of miners to validate and add blocks to the Ethereum blockchain. However, it is important to note that validators have their ETH locked, and any accumulated rewards will remain unavailable to them until the next Ethereum update, called Shanghai, which is tentatively scheduled for March 2023.
Therefore, those who accumulated rewards will finally be able to cash in their profits.
Ethereum quotes. Source: stooq.pl – The only thing left to do is to test the code enabling withdrawals, which should be mostly done by February/March – said Marius Van Der Wijden, Software Developer at the Ethereum Foundation, to CoinDesk.
Further development of the network through proto-danksharding
Another element that Ethereum developers hope to address is “proto-danksharding,” which is derived from “sharding” (a method that divides the network into several chains, or “shards” in a way to make the blockchain more scalable). The developers compared sharding to adding new lanes on a highway. Thanks to this, more cars are able to use this highway and can travel faster on this road as a result of less traffic. The same goes for Ethereum transactions, shards will increase the amount of network activity that the blockchain can process, thus reducing fees and allowing for a faster transaction rate. Danksharding uses the same principle of dividing the network into shards, but instead of providing more space for transactions, it provides more space for blots of data, allowing the network to process more data.
We also recommend: Will Ethereum return to historical highs? Long-term ETH predictions
“Danksharding will be the most exciting thing developers will be working on in 2023. The update has the potential to enable millions of users and truly bring scalability to Ethereum,” said Parithosh Jayanthi, DevOps Engineer at the Ethereum Foundation.
The problem of censorship and centralization of Ethereum
“I think the ecosystem needs to pay more attention to censorship resistance and customer diversity next year. Neither will be strictly addressed in the protocol roadmap for next year, so I hope the community layer takes responsibility until we can reasonably address this in the protocol,” Jayanthi told CoinDesk. The censorship issue has also raised some concerns about centralization as most validators have opted for methods to add transactions to the blockchain that filter Tornado Cash. “We have worked hard to create an Ethereum protocol that is capable of being highly decentralized. But there are centralizing forces everywhere and we have to be super attentive to them. We can’t force people to run Ethereum decentralized, but it will become worthless if they don’t,” said Ben Edgington.
Devcon and EthCC
Ethereum will bring developers, policy makers and other community members together at various global events where they can collaborate on new ideas. Devcon, the largest conference for Ethereum developers, is scheduled to take place again in 2023. Held in Colombia in 2022, the conference is a highlight among Ethereum enthusiasts who often meet in different corners of the world to share their thoughts and innovations on the second largest blockchain. Other notable events for Ethereum include the popular EthCC in Paris, which is scheduled to take place July 17-20 this year.
The author also recommends:
Follow us on Google News. Search for what is important and stay up to date with the market! Follow us >>
