ETH 2.0 is among the most awaited crypto upgrades at the moment.
This upgrade which is expected to offer cheaper gas fees and better scalability to its network is much needed considering that demand has pushed these two factors to their brink. That is the reason why the company’s IT department has been working hard for more than two years to bring in this new era.
However, the name ETH 2.0 doesn’t seem to be doing justice to the major upgrades that are being carried out on the network. As a result, the Ethereum Foundation elected to retire that name in favor of a name that describes better the ongoing upgrades on the blockchain.
This crypto lists post will discuss what the rebrand involved, the reason for the name change as well as the effect of the name change on the price of ETH.
Ethereum 2.0 Has Been Rebranded to Consensus Layer
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The company announced in a blog post on its website that it had decided to change the name of its incoming network upgrade from ETH 2.0 to Consensus Layer. The blog post stated the main objective of making a rebrand to the ETH 2.0 name was the need for terminology that reflected the changes being performed on the blockchain.
According to the developers, ETH 1.0 will now be known as the Execution Layer and ETH 2.0 will now be known as Consensus Layer.
This means that ETH 2.0, their current blockchain consensus that is renowned for its dependence on the Proof of Work (PoW) consensus mechanism, will be referred to as the Execution Layer. On the other hand, the much-awaited ETH 2.0 upgrade, which employs the Proof of Stake (PoS) consensus mechanism, will henceforth be referred to as the Consensus Layer.
Ethereum’s developers have been designing an upgrade to the present PoW consensus mechanism to make it compatible with the PoS chain. The process is predicted to be finished by June 2022.
When the PoS consensus mechanism is finally rolled out to the public, the company would not have to depend on the energy-intensive process of mining. Instead, validators will be assigned the role of verifying new crypto transactions by staking their ETH holdings.
What is the Reason for the Change of Name?
According to the available information, the company elected to change the name to reduce the misconception and confusion linked to ETH 1.0 and ETH 2.0. An example of a misconception is where the network’s users intuitively think that Ethereum 1.0 comes first then ETH 2.0comes after. Or ETH 1.0 ceases to exist once ETH 2.0 arrives. None of these misconceptions are true because both the Execution Layer and the Consensus Layer will form the Ethereum blockchain.
The other reason why Ethereum opted for the name change was to prevent the number of scams from happening on the network. The company highlighted that several scammers seldom take advantage of the massive numbers of users to defraud unsuspecting people about the network.
Scammers usually trick individuals into believing that they have to upgrade from the present consensus mechanism to the ETH 2.0 upgrade. In many cases, this can create confusion for many users and often ends in users losing their funds.
Did the Name Change Have an Impact on the Price of ETH?
Ether announcing the name change did not have any meaningful impact on the altcoin’s value in the crypto marketplace. ETH had greatly suffered during the 2021 crash, having lost around 40% of its price value. Luckily, its price has been steadily increasing until now.
But this price change is still insignificant because Ether is a long way from attaining the $3,000 mark. This has prompted traders and investors to speculate that perhaps, the bear market is impending.
As for ETH 2.0, now Consensus Layer, it is not yet certain whether the scheduled merge with the Execution Layer will be carried out this year. So far, the project has experienced several delays as the developers encounter new challenges. But the crypto giants maintain that the upgrade is still on track.