The Beacon Chain is Ethereum
’s proof-of-stake (PoS) layer where consensus is reached. It controls and coordinates the network of Ethereum stakers who help validate and secure the network in exchange for staking rewards.
The Beacon Chain went live on December, 2020 and is the first in a series of major upgrades (previously collectively known as Ethereum 2.0
) to increase Ethereum’s ability to handle transaction loads more sustainably.
Although the Beacon Chain (previously known as Eth2) is an independent layer that runs parallel to Ethereum’s execution layer (previously known as Eth1), it will soon be connected to the Ethereum mainnet
in an event known as The Merge.
Post-merge, Ethereum’s consensus mechanism will permanently shift from proof-of-work (PoW
) to PoS
. If you are interested in validating the Beacon Chain, you can do so by staking your ether (ETH). As a validator securing the network, you will be in charge of storing data, processing transactions, and adding new blocks to the blockchain.
The ecosystem moving away from mining
new blocks means Ethereum miners will eventually become obsolete. Additionally, tokens will no longer be issued in the form of mining rewards, leading to a projected net reduction in ETH issuance of almost 90%.
The Beacon Chain has set the stage for the following scaling solutions: The Merge, The Surge, The Verge, The Purge, and The Splurge. This set of solutions is designed to tackle the Scalability Trilemma
proposed by Ethereum founder Vitalik Buterin.
The trilemma suggests that a blockchain can satisfy only two out of three of its fundamental principles — security, scalability, and decentralization. A series of upgrades has been postulated to help Ethereum support a larger transaction load by increasing transaction throughput without compromising security or decentralization.