Understanding Ethereum Sharding: A Scalability Solution for Blockchain

Check the Crypto Market Today:

Bittime - Ethereum Sharding is a technique of spreading big data on the blockchain. To understand what Ethereum Sharding is, it's good to understand the meaning of Blockchain and Ethereum first as described below.

What is Blockchain and Ethereum?

Blockchain is a technology that enables the recording and storage of data in a distributed, transparent, and secure manner. The data stored on the blockchain is referred to as blocks, which are interconnected through cryptography. Each block contains information about transactions that occur on the network, such as sender, receiver, amount, time, etc.

Ethereum is one of the most popular blockchain platforms that supports the creation and operation of decentralized applications (dApps) and smart contracts. DApps are applications that run on a peer-to-peer network without intermediaries, while smart contracts are programs that execute agreements automatically based on predetermined conditions.

Why Does Blockchain Need Scalability?

One of the major challenges faced by blockchain is scalability, i.e. the ability to handle large and increasing numbers of transactions. Currently, blockchains like Bitcoin and Ethereum have limitations in terms of transaction speed and capacity. For example, Bitcoin can only process about 7 transactions per second (TPS), while Ethereum is around 15 TPS. Compare that to centralized payment systems like Visa, which can handle up to 24,000 polling stations.

Blockchain scalability is critical to meeting the growing demand from dApps users and developers. If the blockchain cannot process transactions quickly and efficiently, there will be network congestion, high transaction fees, and poor user experience. Therefore, many efforts are being made to improve blockchain scalability, one of which is sharding.

Also Read How to Buy Crypto:

What is Sharding and How Does It Work?

Sharding is a technique of splitting a large blockchain database into smaller partitions referred to as shards. The goal is to spread compute and storage workloads across peer-to-peer networks. With sharding, each node only needs to validate and store part of the data, not the entire data. This can increase transaction speed and capacity, as well as reduce resource requirements for running nodes.

In the context of Ethereum, sharding will work synergistically with layer-2 solutions, i.e. rollups. Rollups are techniques that move most computing and data storage from layer-1 (mainnet) to layer-2 (sidechain), thereby reducing the load on mainnets. Rollups also use cryptographic techniques such as zero-knowledge proofs to prove the validity of transactions at layer-2 without the need to verify them at layer-1.

With the combination of sharding and rollups, Ethereum can significantly improve its scalability. According to estimates by Vitalik Buterin, the founder of Ethereum, sharding can increase Ethereum's transaction capacity by up to 100 times, while rollups can increase up to 1000 times. Thus, Ethereum can reach up to 100,000 TPS, which far surpasses centralized payment systems.

What are the Advantages and Challenges of Sharding?

Sharding has several advantages, including:

• Improve network scalability and performance, by speeding up the process of validating and propagating blocks, and reducing transaction confirmation times.
• Increase decentralization and network security, by expanding node participation and reducing the risk of 51% attacks or other attacks.
• Increase efficiency and cost-effectiveness, by reducing resource requirements for running nodes, such as bandwidth, storage, and computing power.

However, sharding also has several challenges, including:

• Maintain consistency and synchronization of data between shards, by addressing issues such as double-spending, forks, or replay attacks.
• Maintain communication and coordination between shards, by addressing issues such as latency, overhead, or cross-shard transactions.
• Maintain network flexibility and compatibility, by addressing issues such as upgrades, interoperability, or backward compatibility.

Check Crypto Price Today:

When Was Sharding Launched on Ethereum?

Sharding is one part of the Ethereum 2.0 upgrade plan, which aims to improve the scalability, security, and efficiency of the Ethereum network. This upgrade plan consists of several phases, namely:

• Phase 0: Launch of Beacon Chain, which is the master chain that coordinates shards and validators, and adopts a proof-of-stake (PoS) consensus mechanism.
• Phase 1: Launch of 64 shard chains, which are child chains that process and store transaction data, but do not yet support smart contract execution.
• Phase 1.5: The merger of Ethereum 1.0 and Ethereum 2.0, which will end the proof-of-work (PoW) consensus mechanism and make Ethereum 1.0 one of the shard chains in Ethereum 2.0.
• Phase 2: Launch of smart contract execution on the shard chain, which will allow dApps to run across the Ethereum 2.0 network.

Phase 0 has been launched in December 2020, while phase 1 is expected to launch in 2022. Phase 1.5 and phase 2 are still in the development phase and there is no exact schedule for the launch.

Conclusion

Sharding is a scalability solution for blockchains, which divides the network into smaller, interconnected partitions. With sharding, blockchain can increase transaction speed and capacity, as well as reduce node workload and resources. Sharding is part of the Ethereum 2.0 upgrade plan, which will work synergistically with layer-2 solutions, namely rollups. Thus, Ethereum can become a more scalable, secure, and efficient blockchain platform for everyone.

How to Buy Crypto on Bittime

You can buy and sell crypto assets in an easy and secure way through Bittime. Bittime is one of the best crypto applications in Indonesia that has been officially registered by Bappebti.

To be able to buy crypto assets on Bittime, make sure you have registered and completed identity verification. In addition, also make sure that you have enough balance by depositing some funds into the wallet. For your information, the minimum asset purchase at Bittime is Rp10,000. After that, then you can make a crypto asset purchase in the application. Learn the Complete Guide on How to Buy Crypto on Bittime.

Monitor the price chart movements of Bitcoin (BTC), Ethereum (ETH), Solana (SOL) and other cryptos to find out today's crypto market trends in real-time on Bittime.

Also Read:

Ethereum History Story: How Ethereum Became Popular

What is Sharding? Check out the Understanding to the Benefits

Understanding the Shard Concept: A Comprehensive View of Sharding in Blockchain

DISCLAIMER: This article is informational in nature and does not constitute an offer or solicitation to sell and buy any crypto asset. Trading crypto assets is a high-risk activity. Crypto asset prices are volatile, where prices may change significantly from time to time and Bittime is not responsible for fluctuations in crypto asset exchange rates.