Thread by @beniaminmincu

After many years of work, ETH 2.0 has announced an update: ETH 2.0 - Phase 0.

But after a careful review it seems the excitement is overblown, and the actual progress almost trivial compared to that needed to have ETH 2.0 in production.

Here's a contrarian view & solution. 👇

https://twitter.com/VitalikButerin/status/1324018999458295809

First, let's set the context: Ethereum's fundamental problem is scalability: despite a 50$ billion valuation, ETH cannot process more than 15 transactions/sec(!).

In a high bandwidth internet era, this is akin to the earliest versions of 56k dialup modems.

I say fundamental problem, because unlike most other problems, this architecture limitation is practically impossible to be fixed. Thus, paradoxically, the higher an adoption ETH gets, the more obvious and painful this fundamental limitation becomes.

Given the above, for the last 4-5 years ETH has been investing hundreds of millions USD and has funded hundreds of startups, all to address this fundamental limitation. Problem is, ETH can still process only 15 tx/sec, and the efforts have translated to little beyond marketing.

ETH 2.0 was promised as the solution to this fundamental limitation. It was supposed to be built on state sharding, helping ETH 2.0 scale to thousands & tens of thousands of tx/sec.

But progress on ETH 2.0 has been very slow, and the launch scheduled 2 years in the future™.

Which brings us to today: Phase 0 is a rudimentary consensus, lacking sharding or even transaction processing, leaving the hardest engineering problems untouched. ETH will tell you state sharding will be solved, but as always, it's 2 years in the future™ with no solution now.

It is with this context in mind that you can begin to appreciate the surprising progress achieved by the small and relentless team at Elrond.

What's Elrond?

It's the internet scale blockchain. One capable of processing 1000x more tx than BTC or ETH.
elrond.com

Context: In 2017 state sharding was still a hard unsolved engineering problem, but come early 2018, Elrond would present the design of a blockchain architecture based on *adaptive state sharding* and *secure proof of stake* leading to a radical improvement
elrond.com/assets/files/e…

There have been a few other state sharding designs since, but all of them came after Elrond published the full design. And all of them are still at least 6-12 months behind in terms of maturity of technical implementation and actual processing capacity.

In July 2020, after 3 years of intense, exciting, painful and gratifying work, the Elrond network went LIVE with the first full implementation of *adaptive state sharding* and *secure proof of stake* working in production. Cross-shard transactions, and a stateless WASM VM on top.

So how did a small team in Europe achieve something Ethereum, with virtually unlimited resources, couldn’t?

Maybe it’s the deep engineering background of the team; maybe it’s the hunger and sleepless nights; or maybe it's a unique vision of the future tying everything together.

Fact is: Elrond is *live now*, being perhaps the most scalable blockchain architecture in the world.

This means Elrond can process >15K TPS NOW, and can scale sublinearly to hundreds of thousands, achieving 260k+ TPS with 50 shards before mainnet launch.
github.com/ElrondNetwork/…

But there's more. Elrond has 2169 validators participating in the network, with ~51.5% of EGLD staked. The network has actually just crossed the 1.000.000 transaction threshold, all achieved since the 30th July mainnet launch.
explorer.elrond.com/validators

Beyond significant contributions to architecture and consensus design, Elrond has also set a new standard with the Arwen VM - a stateless WASM VM which is among the fastest(perhaps fastest) in the space at both compiling and execution of smart contracts.
docs.elrond.com/learn/the-arwe…

Further, Elrond has created a Rust framework to enable writing more secure smart contracts. Bundled with it, is a declarative testing framework making writing contracts in Rust even more productive.
github.com/ElrondNetwork/…

On top, you can find an evolving Elrond SDK with very useful ERDjs and ERDpy libraries: github.com/ElrondNetwork/…

The most friendly way to write smart contracts on Elrond is of course the Elrond IDE: marketplace.visualstudio.com/items?itemName…

Also a great beginner tutorial:

While performance and useful tools are an important foundation to build on, it is the *30% built-in rewards for any smart contract created* that will attract many devs to start playing and building on Elrond.

To address issues with ERC20 tokens and leverage the Elrond architecture, Elrond has created the Elrond Standard Digital Token, offering the possibility of creating custom tokens at native speed, cost and scalability, without needing smart contracts.

docs.elrond.com/developers/esd…

Each of these features gain more value and appeal by being integrated into a simple and accessible wallet, enabling the Elrond community to easily participate in the ecosystem: Wallet.elrond.com

Thus, all the performance benefits ETH 2.0 intends to provide in ~2 years, are already live on Elrond, ready to be tested by curious devs around the world

Adoption & ecosystem expansion are also coming, but the biggest opportunities are up for grabs for early builders & adopters

Our goal is to (a) create a high bandwidth transparent digital economy, and (b) give anyone, anywhere easy access to it.

We are close to achieving (a). To achieve (b) we’ve built Maiar, giving people around the world a new user experience around money: maiar.com.

Finally, Elrond is compatible with both BTC and ETH, aiming to be interoperable with them.

But our focus goes far beyond them, offering users around the world a new robust digital money, a high bandwidth digital economy, and a simple application to make both accessible globally.