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Ethereum Community Meeting Concludes, Developers: Staking Threshold Not an Issue, 100,000 Ether Enough to Launch 2.0

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Ethereum Community Meeting Concludes, Developers: Staking Threshold Not an Issue, 100,000 Ether Enough to Launch 2.0

The imminent launch of Ethereum 2.0, scheduled for December 1st, is approaching, but the required total amount of Ether still falls short of the 20% threshold. To address this, the development team held an online AMA community meeting on the Reddit forum and claimed that they could reduce the number of validators and the required amount of Ether if necessary to ensure the timely launch of 2.0. Update as of 11/24: The staking threshold has been met, with 534,112 Ether staked as of the deadline.

High Ambiguity, Low Incentives

Aside from Bitcoin hitting new yearly highs, Ethereum 2.0 is one of the most talked-about events recently. The delayed upgrade will transition Ethereum to a Proof of Stake (PoS) system, enhancing its resistance to 51% attacks, reducing user participation costs, and significantly boosting transaction speeds on the blockchain.

However, since the deposit contract address 0x00000000219ab540356cBB839Cbe05303d7705Fa was opened, user participation has been lower than expected. As of the deadline, only 104,448 ETH has been deposited, far below the required threshold of 524,288 ETH. This has raised doubts among many users regarding the timely launch of 2.0.

Researcher: 100,000 ETH is Sufficient to Launch

Ethereum 2.0 researcher Danny Ryan stated that the minimum threshold could be adjusted based on actual conditions to ensure the timely launch of 2.0's genesis block. He mentioned:

Personally, I believe 100,000 ETH is more than sufficient. Lowering the threshold to avoid Ethereum being stuck in this phase for an extended period is a reasonable move. Early participants will be highly rewarded, which may increase over time. I think the threshold should be adjusted immediately on November 24th or December 1st, but the client development team seems to prefer waiting until January for the adjustment, which is also reasonable.

In fact, the development team previously discussed this on Github. Core developer Eric Conner suggested:

I suggest setting a deadline (12/15), so even if the minimum threshold (524,288 ETH) is not reached, the launch can proceed as planned. The minimum deposit amount is primarily for security against attacks, but this number (524,288) was calculated based on ETH at $80. Looking at the current amount deposited on the mainnet, it is already sufficient.

Approximately 2 Million ETH Issued Annually

During the meeting, user ta3ty_tac0s_eth inquired about the future annual issuance of ETH. Ethereum founder Vitalik Buterin provided a seemingly promising answer:

In the next 1-2 years, the expected annual issuance is around 4.7 million ETH. However, after fully transitioning to Proof of Stake, deducting ETH burned from transaction fees annually, the estimate is between 0 to 2 million ETH, with the burned amount possibly exceeding the annual issuance. But talking about it now is meaningless; I hope Phase 0 code progresses smoothly, waiting only for user funds to be in place, and the risks of transitioning to 2.0 have significantly decreased compared to six months ago.

Vitalik Misaligned with Developers

In the AMA, Vitalik mentioned that 2.0 must go live this year to conclude the tumultuous 2020 and hopes to see the culmination of this five-year project. However, he emphasized his agreement with developers regarding the actual launch timing of 2.0, emphasizing that everything depends entirely on the community.

From the developers' perspectives, if the launch does not happen on December 1st, it might be delayed until January. Developer Philippe Castonguay believes that, compared to the market's concern about "when 2.0 will be released," he is more concerned about the well-being of developers. The first one or two weeks post-launch will be the most stressful, and delaying the launch until the 15th will ruin developers' rare vacation time.

Threshold Exceeded on November 24th

As of the deadline, the ETH 2.0 Phase 0 smart contract required a threshold of 524,288 ETH, and it has now reached 530,464 ETH. Ethereum founder Vitalik also counted down to the threshold and posted after achieving the goal.