2020 is looking to be a year of PoS blockchains. While Tim Ogilive, the founder and CEO of multi-blockchain staking service Staked argues that 2019 has already been a big year for PoS, we have a lot to expect from the upcoming year.
First and foremost, Ethereum, the second-largest cryptocurrency by market capitalization, is expected to finally switch to PoS. They have been wanting the switch from 2014, when Vitalik Buterin said that he viewed PoS as a way for Ethereum to mature.
“Ethereum 1.0 is a couple of people’s scrappy attempt to build the world computer; Ethereum 2.0 will actually be the world computer,” shared he.
With Proof Of Stake blockchains, there is no mining, thus no electricity is being used to solve the math problems needed. The validators must own the coins that they are verifying. Experts’ opinions vary on whether PoS is a significantly better way for blockchains to scale when comparing with PoW (Proof of Work) which is being used on Bitcoin and also on Ethereum at the moment.
Also, Cardano, the 12thlargest cryptocurrency by market capitalization is expected to upgrade their already pre-existing PoS platform to a public network. Charles Hoskinson, the CEO of IOHK, the company behind Cardano, has said that the new network will have hundreds of times more people running its software than Bitcoin, Ethereum or any other PoW system.
“This marks the starting point for handing the protocol completely to the community,” commented he.
For the last two years, Cardano has researched and engineered and all this has led up to finally test a running PoS system. Their academic research has mainly been towards coordinating the right amount of network rewards and penalties to keep the system running smoothly and securely.
Shortly after the launch of “Shelly” upgrade, Cardano started planning towards the addition of smart contract functionality which would enable dApp development. After that, they’re aiming to increase the scalability of the network pushing to a remarkable 10,000 transactions per second. Additionally, the full development from “Shelly” to “Basho” upgrades is expected to be fully completed by the end of 2020.
Charles Hoskinson was an original member of the team which founded Ethereum. He worked there up until 2014, when he was asked to leave the project. One of the reasons was that Hoskinson wanted a corporate structure for Ethereum while Vitalik Buterin insisted on a foundation.
However, switching from PoW to PoS is not that easy as it sounds. Ethereum has speculated that the outcome of their new blockchain will be hybrid – something between PoW and PoS. The PoS protocol is not perfect itself. It needs much work on solving the governance problems and that might take years. But 2020 will just be the start.