Ethereumone of the major upgrades in the ShanghaiWhat can it accomplish or cause problems?
Marketsecond largest crypto project by value Ethereum, has been on the agenda with various updates since its emergence in 2015.
Byzantium, Constantinople, Istanbul, Bellatrixundergoing protocol updates such as Merge, Ethereum, next week Going to Shanghai update.So, after this update, what kind of results await us in Ethereum?
What Happened in Previous Updates on Ethereum?
Decentralized smart contracts platform Ethereum ( ETH), bitcoin continues to attract great attention with the dominance it has established in the sector. The popular cryptocurrency project also comes with various network upgrades and protocol updates. has the potential to shape crypto.
2015 – Frontier
Officially 22 July – 02 September 2014Ethereum, which was put up for sale between 2015carried out in frontierIt went into another dimension with a fork. frontier, Ethereum enabled the miners to start operations. However frontier brought another cryptocurrency with it. As a result of this fork, Ethereum Classic appeared on July 30, 2015. remaining in Ethereum’s original network structure Ethereum Classicstands out for preserving the unaltered history of the project. Also, Ethereum Classic is following the footsteps of Bitcoin with its limited supply.
The emergence of this project as a result of the fork made us think that Ethereum would fail and the masses would now shift to Ethereum Classic. However, the crypto market He couldn’t help being stunned by Ethereum’s success.
that period, aljazeeraIn a report by Ethereum was stated to be the most ambitious successor to Bitcoin . This title seems to hold up to this day.
frontier The fork stands out as the pioneering fork in the expansion of Ethereum to the wider ecosystem. After this bifurcation ETH , experiencing a strong rise, built a throne in the crypto market that he will continue for many years. ETH. This bifurcation, which enabled the trade to progress in a stable and developing manner, enabled the project to be carried one step further.
2016 – Homestead
Wanting to make the future of the Ethereum network more specific homestead forking introduced several protocol changes. This fork to Ethereum It contained a network change that allowed for further network upgrades.This feature serves as a backdrop for today’s Shanghai-Capella.
homesteadThe fork of the Ethereum network paved the way for hardfork changes, on the other hand. EVM It also included updates. The impact of this fork on Ethereum was not limited to the network side. ETH’s price, impact of bifurcation It had experienced an increase of approximately 110% in the 1-month period.
However, after forking, It was observed that the ETH price experienced a strong decline from the $13 levels to around $8.3.Although no cryptocurrencies emerged as a result of the fork, the need for further development of the network could not be eliminated.
2017 – Byzantium
Byzantium, which is perhaps one of the most important network updates of Ethereum, had a great share in the success of the project to this day. With the Bizant fork, block mining rewards on the Ethereum network Reduced from 5 ETH to 3 ETH . Also, this update added certain cryptography methods to allow Layer-2 scaling.
October 16, 2017carried out on Byzantium The fork of the project opened the door not only to the development of the network, but also to the rise of the project’s cryptocurrency. During forking ETH, which was at the level of 334 dollars, managed to rise to 1.296 dollars in 3 months with the effect of these updates.
It enables more efficient, more scalable and more active use of the network. Byzantium contributed to the more active progress of the project in the short term. Ethereum maximalists are stunned by the intense interest in the project and ETHHe was happy at that time because of the rise in price.
Updates and Forks Take Ethereum Network One Step Ahead
EthereumUpdates and forks in , took the project one step further. Byzantium In particular, it has been observed that the Ethereum network has seen more demand and the ETH price has risen to four-digit levels. The subsequent Istanbul and Merge updates were also productive for Ethereum. However, Ethereum’s fork was successfully accomplished by Merge, which led to the emergence of a new cryptocurrency by forking.
Ethereum after Merge, Proof of Work ( PoW) model and Proof of Stake ( PoS ) model was switched. In what was seen as a sensational move, the termination of Ethereum mining has received intense criticism in this network change. With this fork, Ethereum PoW, which emerged to continue the PoW structure, became the new active stop of miners.
on Ethereumeverything with this bifurcation had come to a whole new level. . Ethereum now charged less gas fee, had more transactions, and was on its way to becoming deflationary. However, the popular project could not figure out its scaling solutions. Merge Although it was seen as a life-saving update, it also opened the door to future updates. With this update, the project managed to reduce its supply by recording a new milestone.
Ethereum at Crossroads: Shanghai-Capella
A new crossroads and a new network fork for Ethereum will occur on April 12, 2023. This bifurcation was named Shanghai-Capella. The fork, which includes two different network upgrades, will take place on April 12, 2023 at 01:27.
This update brings staking withdrawals to the execution layer. With the Capella upgrade, this service will make it easier for blocks to accept withdrawals as well. ETH staked will be allowed to be withdrawn to the execution layer.
This transaction has the potential to facilitate more network activity on the Ethereum side, earning more fees, and making Ethereum truly deflationary.
It is possible to observe two different crossroads with Shanghai-Capella. One of these crossroads could be the emergence of a new Ethereum coin. As a result of the fork, it is not surprising that a cryptocurrency such as Ethereum PoW and Ethereum Classic emerged. The possible cryptocurrency is coming out with the aim of continuing its previous features. However, Shanghai and Capella are not as big an influence as Merge. Shanghai-Capella, which is mostly protocol updates, leaves two different scenarios in front of the project. These scenarios are;
- one- 32.5 billion dollars of staked ETH circulates and ETHs removed from stake prevent updating… As a result of this situation, problems may occur in Ethereum in the short term. Experiencing dips and network activity losses could turn Ethereum back into an inflationary model.
- 2- The fact that the staked ETHs are not actively used and the Ethereum network may become more active with the update. Shanghai-Capella has the ability to take Ethereum one step further against Bitcoin if used at the right time and in the right situation.
As a result of this update, If Shanghai-Capella succeeds , some revival may occur in the crypto ecosystem. In the development of the crypto ecosystem, when we consider the market dominance of Ethereum, it is on the table to empower altcoins. However Shanghai-Capellain case of failure, EthereumIt has been one of the topics discussed by the crypto ecosystem that there may be a strong decline in .
