Author: Jarrod Watts, Developer Relations Engineer at Abstract; Author: Xiaozou, Golden Finance
Beam Chain is the most important announcement of the Devcon Summit, introducing 9 major upgrades to Ethereum. But most people don’t quite understand these upgrades, and this article will help you better understand these 9 upgrades.
Beam Chain is Justin Drake’s proposal to redesign the Ethereum consensus layer (CL). Before we delve into the specific upgrades, let’s take a quick look at what the Ethereum consensus layer actually is.
Every Ethereum node runs two components: the execution client and the consensus client.
Consensus clients are used by nodes to "agree" on what the next block in the blockchain will be. You can stake 32 ETH to add a third component - a validator, who is rewarded for proposing new blocks through the proof-of-stake algorithm.
So why does the Ethereum consensus layer need a redesign?
There are several issues with CL at the moment:
It’s 5 years old — it’s suffering from technical debt and it’s not using the latest innovations like ZK proofs.
This is an opportunity to perform upgrades and clean up Ethereum’s technical debt.
These 9 upgrades can be divided into 3 categories:
1/Block Production
2/Staking
3/Encryption
Next, I will summarize each upgrade separately.
Upgrade 1: Censorship Resistance
The current block production is very centralized. Two major block builders, Beaver Build and Titan Build, account for almost all Ethereum blocks:
These builders create blocks in such a way as to maximize their profits in the form of MEV; arbitrarily including, excluding, or reordering transactions in the blocks they produce.
Today, if your transaction is not favorable to these two major block builders, they may choose to exclude your transaction from the block and censor your transaction.
The upgrade, proposed in EIP-7805, increases Ethereum’s censorship resistance by allowing validators to select transactions from a mempool and enforce their inclusion through inclusion lists (ILs), rules that builders must follow in order to have their blocks included by the network.
In the Beam Chain upgrade, 16 validators in each slot will build a list of transactions that must be included by block builders, which means that block builders no longer have the ability to censor transactions.
Upgrade 2: Segregated Witness
Attester Proposer Separation (APS) separates witnesses and proposals, e.g. executing auctions.
While validators can build transaction blocks themselves, most use so-called “MEV boosts” to offload block building to someone else (usually Beaver Builder or Titan build), who pays the validator a fee.
The two parties are called:
- Witness (verifier)
- Proposers (block builders)
Today the two are separated - i.e. validators accept blocks from proposers, however, it is centralized through trusted intermediaries called relayers.
Relayers like Flashbots act as “middlemen”, facilitating transactions between validators who want to sell blocks and block builders who want to create profitable blocks.
APS is an upgrade that adds or “embeds” this separation between validators and proposers into Ethereum in a decentralized manner; reducing the risk of centralization by relayers such as Flashbots.
One way to achieve this separation is to implement auctions; a system where anyone can buy a ticket, giving them a chance to win the right to create future blocks.
Upgrade 3: Faster slots
On Beam Chain, slots will change from 12 seconds to 4 seconds.
Slots refer to the period of time during which a validator can propose a new block and obtain the consent of other validators.
Faster slots mean faster transaction finality and higher transaction throughput.
Upgrade 4: Smarter issuance (such as staking cap)
The issuance curve refers to how new ETH is created and distributed over time.
at present:
-ETH will be distributed to validators as rewards in each epoch (about 6 minutes).
-ETH is burned as part of every transaction.
ETH fluctuates between inflation and deflation depending on network activity. For example, in a given hour, you can see that ETH is inflationary because more ETH rewards are issued than burned in transactions:
There is a lot of debate in the community about whether and how issuance should change, but Justin Drake mentioned the staking cap in his Beam Chain presentation. The staking cap sets a maximum amount of ETH that can be staked in order to provide more predictable rewards to validators, possibly with the goal of making ETH deflationary.
Upgrade 5: Smaller Validator
Currently, you need to buy 32 ETH to become a single validator on Ethereum. At today’s prices, that’s about $100,000.
Beam Chain proposes to reduce this to 1 ETH, which would help solve some of the centralization issues with liquidity staking providers like LIDO or Coinbase, which currently control nearly 40% of the staked ETH:
Users who want to run a validator to earn rewards but do not have 32 ETH will benefit from this upgrade, as they will be able to run a validator node with only 1 ETH.
The next upgrade (Pectra) will allow stakers to stake more than 32 ETH, up to 2048. This means that on Beam Chain, users will be able to stake 1-2048 ETH.
Justin mentioned the Orbit staking method, which depicts a system in which larger validators are selected more frequently and receive small rewards frequently, while smaller validators are selected less frequently but receive larger rewards.
Upgrade 6: Faster finality (like 3 Slot FFG)
Currently, it takes about 15 minutes (64 slots) for Ethereum to finalize a transaction.
Single-Slot-Finality has been proposed as a way to reduce this time to 1 slot, but a newer proposal - 3-Slot-Finality - may actually be faster because it runs in parallel with the voting round.
This means that a transaction will be finalized in 36 seconds instead of 15 minutes. This is especially important for services that rely on L1 finality, such as DeFi applications or cross-chain/interoperability protocols.
Upgrade 7: Chain Snarkification
Beam Chain hopes to “snarkify” the consensus layer (using ZK-SNARKs, a secure ZK proof). Justin Drake calls this the “ZK Era”.
Specifically, Beam chain proposes to use ZK-SNARKs to:
- Compile beam chain deployments in different languages into zkVM bytecode.
- Aggregate the signatures generated by witnesses into a ZK proof.
The ELI5 here refers to the fact that ZK technology has made great progress in the past five years, and Ethereum hopes to deploy it natively at both the consensus layer and the execution layer.
Upgrade 8: Quantum Security
Today, quantum computers can break parts of Ethereum, such as cracking your private key or forging signatures in transactions using methods such as Shor's algorithm.
Quantum computers will likely be available to people within the next decade; therefore, the Beam Chain proposal hopes to provide Ethereum security for the future post-quantum world by using methods such as hash signatures with post-quantum security.
Upgrade 9: Strong Randomness
Finally, the Beam Chain upgrade proposes a way to build a randomness source using a new primitive called VDF (Verifiable Delay Function).
Justin Drake talked about this in 2018, saying that this can be used to:
Consensus layer — e.g. random selection of validators.
Application layer - for example, exposing an opcode that can provide verifiable randomness.
This would not be possible today without third-party services like Chainlink or Pyth VRF.
In addition to these 9 upgrades, the Beam Chain upgrade will also clean up most of its existing technical debts and unnecessary components that will become redundant after the upgrade.
For example, faster slot finality might mean that epochs are not needed.
But some people think that the time span of Beam Chain is too long. However, Justin later clarified that Ethereum will continue to receive updates within these 5 years.
The Beam chain fork will take 5 years, including continuous upgrades to Ethereum.
