14 Mar 2022
The state of the Ethereum Consensus Layer upgrade
The Ethereum Consensus Layer upgrades, previously called Ethereum 2.0, progress as the staked ETH and the number of validators see steady growth.
A total of 312,000 validators together stake 10 million ETH on the Beacon Chain. This $25.8 billion worth of ETH represents 8.3% of the total circulating supply.Such a high share of the total circulating supply staked indicates that the confidence in Ethereum's long-term future is high. In addition, the current yearly staking reward of 4.81% has likely also contributed to attracting ETH holders to stake their holdings to earn yields.The Consensus Layer upgrades will change Ethereum's consensus mechanism from proof-of-work to proof-of-stake, in addition to improving scalability and speed by introducing sharding.The first step in these upgrades was running a proof-of-stake chain parallel to the historical proof-of-work chain. The Beacon Chain is the name of this proof-of-stake chain, and the plan is to merge these two chains during the summer of 2022, replacing miners with validators. This step is called "The Merge".The third step in the Consensus Layer upgrades is to introduce sharding in 2023.As often with such massive software updates, the Ethereum Consensus Layer upgrades have taken longer than anticipated. It’s therefore uncertain whether the Ethereum team will follow their current deadlines.