Bitcoin’s momentum could impact Ethereum’s 2020 halvening

Bitcoin (BTC), Bitcoin Cash (BCH) and Litecoin (LTC) are looking forward to the third halvening in 2020. While things don’t seem to be working in favor of Ethereum; a rise in inflation rate is expected just weeks before the Bitcoin on May 20, 2020. The reason for this expected scenario is that the Ethereum is all set to launch an entirely new Proof-of-Stake (PoS) Beacon Chain in January 2020.

When it comes to the prevailing design, the new chain has absolutely no connection to the Proof-of-work (PoW) chain and this PoW, in all aspects unrelated to the PoS chain. PoS integrates the headers of the blocks of PoW, in order to keep it to only one block in the entire Ethereum ecosystem whereas PoW blocks are unaware of PoS’ function.

Ethereum Foundation’s researcher Diederik Loerakker stated that the voting system of ETH2 keeps track ETH1 chain. While there are no options for reverse as of yet, but they are exploring various options. He further stated that it is being researched whether the security of PoW is influenced by the Beacon or not. As it is not inconsequential, and it is a top priority to make the phase ‘o’ successful.

Phase o is something that is between mainnet and testnet, Vitalik Buterin referred to phase o as dummy chain. Currently, they lack smart contracts and Ethereum Virtual Machine (EVM), which are expected to be combined in 2021. So, basically, Beacon Chain is staking logic, and its design includes sharding, to enhance the volume in a couple of years. Meanwhile, for that period, no concrete insurance plans have been finalized.

Previously, Ethereum had its insurance reduction back in February when there was an increase in the difficulty of coded algorithms, which reduced the reward for the block automatically from per block 3eth to 2eth. It is worthy to note that the industrial miners earn a little more than one billion dollars ($1.2) a year with already a lot of risky investment. This indicates that they do have some influence in the process…

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