Understanding the Functioning of Ethereum

The network began its operation by using a consensus mechanism which initially involved proof-of-work, but in 2022 it switched to proof-of-stake. The PoS consensus mechanism is considered to be extra secure which tends to use less energy and is much more efficient for implementing scaling solutions as compared to the previous model.

The validators are allowed to stake capital in the form of Ethereum in the current model and join the network where this stake ETH acts as collateral. Once it is activated, validators receive new blocks from their peers on the ETH network, then they are responsible for sending it out to other nodes on the network.

Furthermore, validator nodes vote on the validity of a new block of transactions, thus it collectively ensures that new blocks are authentic and in force before adding them permanently to the main blockchain. Then, out of these nodes, one node is selected as the “block proposer” for the current time slot, which is highly responsible for building the new block of transactions.

A PoS is much better than PoW, as it does not use heavy computational power to solve a riddle. But, in the PoS system, the node validates the new transactions itself and stakes its value as collateral. These nodes then run competently to avoid losing that collateral.

With the “Ethereum merge” now complete after years of hard work, Ethereum’s transition to PoS is finally active. Now with this crucial change, the Ethereum network instead of using “miners” started to use “validators” to approve, create and add blocks to the blockchain. $ETH #ETH🔥🔥🔥🔥 #ETHETFsApproved #ethbeta