Vitalik Buterin (Ethereum) (Dec 2018)

Vitalik Buterin (Ethereum Co-founder) – Latest on Ethereum by Vitalik Buterin (Devcon4) (Dec 2018)

Chapters

00:00:22 The Road to Ethereum 2.0: Evolution of a Blockchain

Introduction:
Vitalik Buterin provides an overview of Ethereum 2.0, emphasizing its combination of features and the journey leading up to its development.

The Road to Proof of Stake:
In 2014, Vitalik Buterin introduced the Slasher algorithm, which introduced the concept of penalizing malicious actors in proof-of-stake systems.
Various aborted ideas for scalability were explored, including proof-of-proof-of-work, hub-and-spoke chains, and hypercubes.
The concept of weak subjectivity was developed to formalize the security conditions for proof-of-stake deposits and slashing.

Ethereum’s Roadmap:
Vinay Gupta outlined Ethereum’s four-stage roadmap in 2015: Frontier, Homestead, Metropolis, and Serenity (proof of stake).
Research on Casper CBC began quietly, and the idea of consensus by bet was explored but later abandoned in favor of BFT-inspired consensus.

Rent and Scalability:
The concept of rent was introduced to charge fees over time for storage usage.
EIP 35 attempted to formalize the concept of rent, and iterations on its implementation have continued since then.
A scalability paper explored quadratic and super-quadratic sharding but faced challenges with escalation games and deep state reversions.

The Fisherman’s Dilemma:
The fisherman’s dilemma highlights the difference between scaling execution of state and programs versus scaling data availability.
Cheating is possible in data availability games by withholding data until it is checked, which poses a challenge for certain scalability algorithms.

Setbacks and Progress:
The DAO hack and DOS attacks delayed progress on Ethereum 2.0, but work continued on EWASM, the virtual machine, and alternative solutions like EVM 1.5.
Research strands focused on proof of stake, scalability, virtual machine efficiency, abstraction, and protocol economic improvements.

Minimal Slashing Conditions:
In early 2017, the Minimal Slashing Conditions protocol was developed, translating PBFT-style Byzantine consensus into a blockchain context.
This protocol enables pipelining efficiencies by merging sequence numbers and views, resulting in significant efficiency gains.

00:11:37 Evolution of Ethereum 2.0: From Hybrid Proof-of-Stake to

Casper FFG:
Casper FFG (Friendly Finality Gadget) was a hybrid proof-of-stake mechanism that would allow for a smooth transition from proof-of-work to proof-of-stake. It involved implementing Casper FFG as a smart contract on the existing blockchain and making tweaks to the fork choice rule.

Sharding:
A new sharding design was proposed, keeping the main chain and creating sharding as a Layer 2 system on top of it, eventually becoming Layer 1. The idea was to have a more efficient sharding system by making it its own Proof-of-Stake chain rather than a contract on the Proof-of-Work chain.

Merging Casper FFG and Sharding:
It was realized that working on separate implementations of Casper FFG and sharding was inefficient, leading to a decision to merge the two. This allowed for the development of a single spec and protocol that would incorporate the benefits of both Casper Proof of Stake and sharding.

Fork-Choice Rules:
Discussions and research were conducted on fork-choice rules, with a focus on GHOST (Greedy Heaviest Observed Subtree Algorithm). Justin Drake’s research on verifiable delay functions progressed, and collaborations with Stanford researchers yielded positive results.

Abstraction, Signature Algorithms, and Fees:
Ideas on abstraction, user-selectable signature algorithms, and rent (renamed to storage maintenance fees) were explored. Vitalik Buterin published a paper on resource pricing, covering topics like fee markets, storage, and storage maintenance fees.

Cross-Shard Transactions and Casper CBC Sharding:
Cross-shard transactions were investigated, including concepts like cross-shard contract yanking. Casper CBC research expanded into its own brand of sharding, dubbed Vallarding.

Multi-Client, Decentralized Development:
Ethereum 2.0 adopted a multi-client, decentralized development strategy to hedge against the risks of single-client development. The goal was to foster a development ecosystem less dependent on the Ethereum Foundation and encourage a variety of clients with different strengths.

00:19:55 Ethereum Serenity Overview

00:24:09 Ethereum 2.0: Post-Serenity Roadmap and Innovations

Abstract

Ethereum 2.0: A Paradigm Shift in Blockchain Technology and The Road to Serenity

Leading the Blockchain Revolution: The Emergence of Ethereum 2.0

The blockchain landscape is on the brink of a transformative era with the advent of Ethereum 2.0, a revolutionary upgrade to the Ethereum platform. Spearheaded by the visionary co-founder Vitalik Buterin, this comprehensive overhaul aims to address core challenges in blockchain technology, primarily scalability, efficiency, and sustainability. Key elements of Ethereum 2.0 include the transition from Proof of Work (PoW) to Proof of Stake (PoS), sharding for enhanced scalability, virtual machine optimizations, and refined protocol economics.

Proof of Stake: A Quest for Enhanced Security and Efficiency

A critical component of Ethereum 2.0 is the shift to Proof of Stake, a concept first introduced by Buterin in 2014. This new consensus mechanism, unlike the energy-intensive PoW, offers improved security and efficiency. It leverages the economic stake of participants to maintain network integrity, thereby reducing the environmental footprint and enhancing transaction processing capacity.

Sharding: Solving the Scalability Puzzle

To address the persistent challenge of scalability, Ethereum 2.0 introduces sharding. This technique partitions the network into smaller segments, known as shards, facilitating parallel transaction processing. This advancement significantly increases the network’s throughput and reduces latency, marking a substantial leap in blockchain technology’s scalability.

Ethereum Virtual Machine: Enhancing Performance

The upgrade also encompasses significant improvements to the Ethereum Virtual Machine (EVM), the core engine for executing smart contracts. With the introduction of eWASM (Ethereum WebAssembly), Ethereum 2.0 promises to boost the efficiency and performance of smart contract execution, paving the way for more sophisticated applications.

Refining Protocol Economics

Buterin has emphasized the importance of meticulously balancing various parameters like block rewards, slashing penalties, and transaction fees. This careful calibration aims to incentivize participation, ensure network stability, and prevent malicious activities, ensuring Ethereum 2.0’s long-term sustainability and security.

Challenges on the Road to Ethereum 2.0

The journey towards Ethereum 2.0 has not been without obstacles. The development process faced numerous challenges, including setbacks in research, the DAO hack, and DOS attacks. However, the Ethereum community remained resilient, gradually progressing towards the realization of Ethereum 2.0.

Convergence of Research: Innovating Blockchain Consensus

A significant milestone in the development of Ethereum 2.0 was the convergence of research efforts leading to the Minimal Slashing Conditions protocol. This innovation streamlined the traditional Byzantine consensus algorithms for blockchain, optimizing block production and confirmation processes.

Serenity: A New Era for Ethereum

Serenity, the fourth stage in Ethereum’s development, marks a crucial phase in the network’s evolution. It integrates major advancements like Casper, sharding, eWASM, and other research developments. Serenity represents a transition to a decentralized world computer with enhanced processing capabilities and aims to achieve a higher degree of decentralization compared to the current Ethereum network.

Key Features and Innovations of Serenity

Serenity is set to introduce a pure Proof-of-Stake mechanism, offering faster confirmation times and improved scalability through sharding. It supports decentralized applications and smart contracts, aiming for enhanced decentralization and reduced storage requirements for validators.

Post-Serenity Developments and Medium-Term Goals

Post-Serenity plans include further improvements in privacy, cross-shard transactions, and potential integration of Casper CBC and Starks for various functionalities. The medium-term goals focus on stabilizing Layer 1 functionalities, refining protocol guarantees, and exploring governance mechanisms.

Ethereum 2.0: Immediate Next Steps and Lessons Learned

The immediate next steps for Ethereum 2.0 involve stabilizing the protocol specification, conducting cross-client testnets, security audits, and finally launching Serenity. Lessons learned from Ethereum 1.0’s development emphasize the importance of cross-client compatibility and the necessity of thorough security audits.

Precompiles for Elliptic Curve Operations and Pairings: To enhance privacy, Ethereum 2.0 may introduce precompiles specifically optimized for elliptic curve operations and pairings. These precompiles aim to improve the efficiency and cost-effectiveness of executing such operations on the blockchain.

Layer 2 Solutions for Privacy Preservation: Beyond precompiles, Ethereum 2.0 may also leverage Layer 2 solutions to further enhance privacy. These solutions, such as zero-knowledge proofs and homomorphic encryption, can be integrated into applications built on Ethereum 2.0 to protect sensitive data and transactions.

Cross-Shard Transactions and Semi-Private Chains: For improved communication and interoperability between shards, Ethereum 2.0 is exploring the implementation of cross-shard transactions. Additionally, the concept of semi-private chains, where specific shards are permissioned and have controlled access, is being considered to cater to use cases requiring higher privacy or regulatory compliance.

Casper CBC Integration: Casper CBC, a variation of the Casper protocol, may be integrated into Ethereum 2.0 if it proves cost-effective and offers significant advantages over the current Proof-of-Stake mechanism. Casper CBC aims to enhance scalability and security by allowing validators to propose blocks in parallel.

Stabilizing Layer 1 Functionalities: A key medium-term goal for Ethereum 2.0 is to stabilize Layer 1 functionalities, ensuring the core infrastructure is robust, reliable, and secure. This includes refining the issuance and fee mechanisms to maintain a balanced and sustainable economic system.

Governance Mechanisms and Features: To ensure Ethereum 2.0’s long-term viability and adaptability, the development team is exploring various governance mechanisms and features. These mechanisms will enable stakeholders to participate in decision-making, propose changes, and collectively steer the direction of the platform’s evolution.

Conclusion

Serenity is Ethereum’s vision for a decentralized world computer, addressing scalability, decentralization, and security concerns. It introduces sharding, proof-of-stake, and other innovations to create a more robust and capable blockchain platform. With the integration of privacy-enhancing features, Layer 2 solutions, and potential advancements in Proof-of-Stake, Ethereum 2.0 aims to drive the next wave of blockchain innovation and adoption.

Notes by: Random Access

Vitalik Buterin (Ethereum Co-founder) – Latest on Ethereum by Vitalik Buterin (Devcon4) (Dec 2018)

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Abstract

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