Ethereum 2.0-Beacon Chain Explained

In my recent article on Ethereum 2.0, I have written an overview of the entire Ethereum 2.0 system and its different phases. This article will help you in understanding Phase 0 of the network upgrade process i.e the Beacon chain and its features in greater detail.

Ethereum 2.0 is under construction. One of the main design goals of Eth 2.0 is to reduce network complexity even at the cost of loss in efficiency if required. With Sharding and Casper implementations, the Ethereum Blockchain is expected to be more stabilized.

This upgrade will improve the below features resulting in Ethereum to new heights:

· Casper Proof of Stake: Pure PoS consensus

· Sharding — Improve the scalability of approx ~1000x higher than the current network.

· EWASM -Fast VM execution via EWASM

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Phase 0 — Beacon Chain

The Beacon Chain is the core of the Ethereum 2.0 system chain. ­It is responsible for managing the consensus algorithm i.e Casper Proof of Stake protocol for itself and all of the shard chains.

The network is run by a group of validators. To become a validator, the node sends its stake into the smart contract on the current Ethereum blockchain. The stake got locked up and after validity check, a receipt will be generated that contains an ID which indicates the shard to which the validator will be assigned. The validator status upgraded to active once his/her public key reaches a balance of 32 ETH. A validator gets activated when the beacon chain processes the deposit receipts from the Eth 1.0 blockchain.

New blocks are proposed by active validators for each block and the other active validators must vote on its validity. Attestations are the prime source of load on the beacon chain. An attestation is typically validator’s vote backed up by the validator’s balance. These are availability votes for a shard block and, simultaneously, proof of stake votes for a beacon block. A sufficient number of attestations for the same shard block created a crosslink confirming the shard segment up to that shard block into the beacon chain. The beacon chain uses these crosslinks to identify the updated state of shard chains. These crosslinks are also required for asynchronous cross-shard communication.

The Beacon Chain is in its final stages of development and testing but its exact release date is still uncertain.

Responsibility of the Beacon chain

The main responsibility of the Beacon chain includes:

· Managing validators and their stakes– One of the important tasks of the Beacon Chain is to manage the group of validators in the network who runs the Ethereum 2.0 system.

· Nominating the chosen block proposer for each shard at each step- In Ethereum 2.0, blocks are produced regularly in every 16 seconds which is called as “slots”.

At each slot, the chosen proposer for the Beacon Chain collects all the attestations from the Beacon Chain validator set for previous blocks and forms them into a block that it publishes.

· Organizing validators into committees to vote on the proposed blocks-

The beacon chain load relies on attestations which are the vote from its committee validator to form the history of the chain. The Beacon Chain also appoints smaller sub-committees for each shard at random that are responsible for confirming that the shard’s proposers are behaving correctly.

· Applying the consensus rules- The Beacon chain is responsible for managing the Proof of Stake protocol for itself and all of the shard chains.

· Applying rewards and penalties to validators– Beacon Chain is also responsible for monitoring the behavior of the validators. Rewards are given to the validators as an incentive for maintaining good behavior. Similarly, any malicious activity like unavailability and not performing its duties correctly or publishing conflicting information about the chain leads to a penalty (slashing) where some of their deposited asset from 32 Ether is deducted or in worst cases can be thrown out of the system depending upon the other factors.

A validator will be kicked out from the validator set if its deposit falls below 16 Ether.

· Being an anchor point on which the shards register their states to facilitate cross-shard transactions-The current state (the “combined data root”) of each shard gets recorded in a Beacon Chain block as a crosslink. When the Beacon Chain block has been finalized, the corresponding shard block is considered finalized. The other shards can depend on it for cross-shard transactions.

· Randomness provision

To maintain security when sharding a blockchain, the beacon chain performs random shuffling from a committee of validators to be assigned to each shard block. This process prevents the system from any attack or to be controlled by a single bad actor.

What will the network look like?

During Phase 0, the Eth1 chain will work as it is. After the completion of Phase 0, there will be two active Ethereum chains.

· Eth1 chain i.e Current PoW main chain.

· Eth2 chain New Beacon Chain

The Ethereum 1.0 chain is expected to become the first shard chain on Ethereum 2.0. Until then, the Ethereum 1.0 chain will continue to operate in the same way as it is running now. But it is expected to undergo certain improvements to embed it as an Ethereum 2.0 shard.


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Ethereum 2.0-Beacon Chain Explained was originally published in Coinmonks on Medium, where people are continuing the conversation by highlighting and responding to this story.