FX.co ★ Vitalik Buterin says Ethereum is ready for an even bigger update

Vitalik Buterin, one of the co-founders of Ethereum, said the recent change in the blockchain shows that the network is ready for an even bigger upgrade - a 99% cut in energy consumption.

Just this Thursday, Ethereum had a software update called "London Hard Fork", which includes a fee reduction feature called EIP 1559. The change is said to prove that Ethereum is capable of significant developments.

Both Ethereum and Bitcoin operate using a "proof-of-work" system that requires a global network of computers running around the clock. The software developers at Ethereum have worked for years to move the blockchain to a so-called "proof-of-stake" system, which takes a completely different approach to secure the network. They are also working to eliminate the carbon footprint.

Buterin said this change to ETH 2.0 will be implemented through a merger and could happen by 2022, or as early as the end of the year.

Ethereum has already seen incredible price increases over the past 12 months, along with Bitcoin and other digital assets. It rose by about 590% over the past year, while Bitcoin has more than tripled. The gains came even after both tokens fell by about half from their recent all-time highs in April.

The surge in ETH prices is partly due to the rise in the number of non-fungible tokens or NFTs, which are digital files that can be authenticated using a blockchain like Ethereum.

In any case, the changes in Ethereum will bring it closer to how Bitcoin works. Unlike ETH, Bitcoin has a fixed 21 million supply of coins ever since its launch in 2009. This difference has led critics of Ethereum to argue that it should not be viewed as a digital currency similar to Bitcoin. Buterin initially limited the amount of ETH that could be created, but said there is now room for change

Another major change in Ethereum is the block size, which is now subject to change. Previously, the number of transactions that could fit in one block was fixed, which meant that users had to sometimes wait for their transactions to be processed when there was high network demand. Now, blocks can now grow or shrink according to the number of incoming transactions.