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Key milestones in the history of Ethereum and how to prepare for the Cancun upgrade.

veDAO研究院

2023-06-28 20:00

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Original Title: "Cancun Upgrade is Coming, Taking Stock of Key Milestones in Ethereum History | veDAO Research Institute"

Original Source: veDAO

Until today, blockchain technology can still be considered as an emerging technology. Although the basic concepts related to blockchain (cryptography, decentralization, peer-to-peer network, and transactions) have been studied for decades, it was not until the birth of Bitcoin in 2008 that people believed these concepts could be combined to create usable products. Especially with Ethereum, it did not appear in people's vision in a public and usable form until 2015. Although the expected development timeline and specific details have changed, Ethereum still insists on advancing according to the plan, constantly upgrading the protocol to ensure improved usability, security, functionality, and decentralization.

This year, Ethereum will undergo two important upgrades as planned, namely the Shanghai upgrade completed on April 12 and the Cancun upgrade expected in the fourth quarter. According to the official Ethereum documentation, since the release of the white paper in 2013, there have been 24 milestone events, most of which are fork upgrades, with 12 relatively important upgrades. This article will review and summarize the important hard forks and upgrades in Ethereum's history, as well as introduce the changes that the Cancun upgrade may bring.

Frontier Upgrade - July 30, 2015

On July 30, 2015, the date of the creation of the Ethereum genesis block, marked the beginning of the first phase of Ethereum. The launch of Frontier signaled the official launch of the Ethereum blockchain network. This phase was mainly aimed at blockchain developers and node participants who participated in mining. This phase already supported the uploading of smart contracts.

Frontier Protocol includes the following key features

Block reward: When miners successfully mine a block on the Ethereum blockchain, they will receive a reward in ETH. During the Frontier stage, the block reward for miners is 5 ETH per block.

Gas: In the early days after the release of Frontier, the Gas limit for each block was hardcoded to 5000 gas. In other words, this means that there won't be any big actions on the network. This leaves a buffer period for miners to start working on Ethereum and for early users to install clients. After a few days, the Gas limit is automatically lifted and the network can begin processing transactions and smart contracts as planned.

Canary Contract: This contract is used to inform users which chains have been or are susceptible to attack. The Canary contract is assigned a value of 0 or 1. If the contract is assigned a value of 1, the client can recognize that this is a faulty chain and avoid mining on this invalid chain. Essentially, the functionality of the Canary contract allows the Ethereum core development team to pause the network's operation when problems arise. In the early stages of Ethereum, the Canary contract was an extremely centralized yet indispensable protection mechanism.

Usability: All developers operate through the command line because there is no graphical user interface. The entire network is available, but the user interface is very rough and only those who are familiar with Ethereum and have operational experience are able to use it.

In the early version, the Gas limit of each block was hardcoded to 5000Gas. However, the 5000Gas limit was removed and the default Gas price was set to 50gwei in the Frontier thawing upgrade two months later. Additionally, the difficulty bomb was introduced in this upgrade to provide a mechanism for the network to transition from PoW to PoS. When the hash rate is too high and miners cannot mine any blocks, it will be the best time for the network to switch to PoS. It can be said that there was already a plan to transition to PoS in the initial stage of Ethereum.

From now on, Ethereum officially enters the quasi-available PoW mining era, with the price of Ethereum at $1.24 per unit.

Homestead Upgrade - March 14, 2016

Homestead is the second major version released by Ethereum. This is the first hard fork of Ethereum and the start date of the second phase of the roadmap. The most important feature of this version is the optimization of smart contracts and the introduction of a new code for the smart contract language Solidity. In addition, the desktop wallet Mist was released in this version, allowing users to hold/trade ETH and write/deploy smart contracts. Later, the Mist project was announced to be terminated in early 2019.

Homestead Upgrade is one of the earliest Ethereum Improvement Proposals (EIPs), which includes 3 EIPs: 2, 7, and 8. EIP-2 increases the cost of creating a smart contract through a transaction from 21,000 Gas to 53,000 Gas. Previously, the cost of creating a contract through a contract (recommended method) was higher than creating a contract through a transaction. With the increase in gas cost for creating a contract through a transaction, EIP 2 incentivizes users to revert to creating contracts through a contract.

EIP-7: Added a new function DELEGATECALL for code reuse. This opcode is similar to CALLCODE, but differs in that it sends the sender and value from the parent scope to the child scope, meaning that the created call has the same sender and value as the original call.

EIP-8: A forward-looking network upgrade proposal that improves the network protocol devp2p with forward compatibility. This improvement ensures that all client software on the Ethereum network can adapt to future network protocol upgrades.

At this time, the price of Ethereum is $12.5 per unit.

DAO Fork - July 20, 2016

Aside from planned Ethereum upgrades and hard forks, there is also an unplanned forking event that is worth remembering. In 2016, a decentralized autonomous organization project called The DAO raised $150 million through token sales. In June, The DAO's contract was exploited by hackers, resulting in millions of dollars worth of ETH being stolen by unknown hackers. The majority of Ethereum community members decided to implement a hard fork to recover the stolen ETH from the wallets and patch the vulnerability. However, the hard fork did not receive unanimous approval from all community members, and some continued to mine and trade on the original chain. The original chain where the stolen ETH was not recovered is called Ethereum Classic (ETC). Since then, Ethereum has split into two separate networks, ETH and ETC, which is why there are two networks for Ethereum.

At this time, the price of Ethereum is $12.54 per unit.

Metropolitan: Byzantine Upgrade - October 16, 2017

At this point, Ethereum has already undergone two major milestone upgrades: Frontier and Homestead. According to the plan, the next step is the Metropolis upgrade, but since the Metropolis upgrade involves a lot of content, the plan was divided into two phases: Byzantium and Constantinople.

This hard fork includes 9 improvement proposals (EIP 100, 658, 649, 140, 196, 197, 198, 211, 214). In addition to updates related to opcodes, smart contracts, and other underlying aspects, the "difficulty bomb" has been postponed for a year and a half, and block rewards have been reduced from 5 ETH to 3 ETH. Prior to the removal of the difficulty bomb, block generation time was close to 30 seconds. The ability to make non-state-changing calls to other contracts has been added, as well as some cryptographic methods to allow for Ethereum's Layer2 scaling.

At this time, the price of Ethereum is $334.32 per unit.

Metropolis: Constantinople Upgrade - February 28, 2019

The second phase of the Constantinople upgrade was originally scheduled to go live at block height 7,080,000 in mid-January 2019. On January 15th, an independent security audit firm called ChainSecurity released a report stating that one of the five major system upgrades would give attackers the opportunity to steal funds. In response to the report, Ethereum core developers and other members of the community voted to postpone the upgrade until the security issue is resolved.

Finally, the Ethereum Foundation has decided to carry out the final step of the "Metropolis" on February 28, 2019, which is a hard fork called "Constantinople" that includes six improvements: ensuring that the blockchain will not be frozen before implementing the PoS mechanism, optimizing the gas cost issue in the Ethereum virtual machine, and adding interactive capabilities for address creation. Interestingly, there is also a hard fork called "St. Petersburg" in this upgrade, which removes a proposed improvement (EIP-1283) from Constantinople. In addition to technical adjustments, the five major updates also include a 12-month delay of the difficulty bomb and a reduction of the block reward from 3 ETH to 2 ETH.

Meanwhile, a new instruction called CREATE2 was introduced in EIP1014, which allows the contract address to be pre-calculated before the contract is formally deployed. This introduces the concept of state channels similar to the Bitcoin Lightning Network into Ethereum, allowing for off-chain calculations before deploying the corresponding contract for settlement on-chain.

At this time, the price of Ethereum is $136.29 per unit.

Istanbul Upgrade - December 8, 2019

Ethereum 2.0 plans to launch its first phase (phase 0) in 2020. Before 2.0 is fully launched, most users and developers may primarily use Ethereum 1.X, so updates to 1.X are also very important. The Istanbul hard fork was activated on December 8th and includes six improvements: further optimization of gas costs in the Ethereum virtual machine; improved recovery capabilities against distributed denial-of-service attacks; improved performance of Layer2 scaling solutions developed based on SNARKs and STARKs verification mechanisms; interoperability between Ethereum and Zcash; and allowing Ethereum smart contracts to introduce more creative features.

Vitalik Buterin said that after this upgrade, the ordinary transactions per second (TPS) will increase by about 5% to 10%, while for Layer 2 technology Rollup, it can increase by about 4 times. At this time, the price of Ethereum is $151.06 per unit.

Muir Glacier Upgrade - January 2, 2020

Less than a month after completing the Istanbul upgrade, Ethereum has undergone an emergency upgrade. It is very rare to have two hard forks within a month, but users and developers have discovered a slight increase in the block generation interval of Ethereum recently, which will lead to a decrease in the TPS of the Ethereum network. Ethereum developers have discussed and proposed a hard fork code-named "Muir Glacier" at block height 9,200,000 to remove the difficulty bomb, which is expected to occur around December 31, 2019. According to the data provided by developers in the discussion group, the block generation time of Ethereum will continue to increase before the difficulty bomb is removed, and it may reach 25 to 30 seconds around January 6.

At this time, the price of Ethereum is $127.18 per unit.

Berlin Upgrade - April 15th, 2021

Starting from this version, the upgrade code name will follow the order of the Ethereum Developers Conference Devcon, and the first Devcon 0 was held in Berlin. Ethereum has planned many improvements for the Istanbul upgrade before, but due to various reasons, some of the improvement proposals that did not make it into Istanbul will be moved to Berlin. This optimization addresses the gas cost issue in the Ethereum virtual machine and adds support for multiple transaction types.

At this time, the price of Ethereum is $2454 per unit.

London Upgrade - August 5, 2021

This upgrade involves five proposals: EIP-1559, EIP-3198, EIP-3529, EIP-3541, and EIP-3554. One of the most significant EIPs that will impact Ethereum is EIP-1559. This proposal aims to change the existing Ethereum fee structure by splitting fees into base fee and miner fee, and reducing the circulation of ETH by burning a portion of the base fee.

It directly changes the economic model of Ethereum. Previously, block packaging was an auction mechanism where the highest bidder got all the Gas fees paid to the miner. EIP1559 divides the Gas fees into two parts, one part goes to the miner and the other part is burned, thus bringing Ethereum into a deflationary era.

At this time, the price of Ethereum is $2621 per unit.

Paris Upgrade (The Merge) - September 15, 2022

This upgrade (merge) directly modifies the execution layer and consensus layer of Ethereum, and is an important upgrade that transforms the Ethereum mainnet from PoW consensus mechanism to PoS consensus mechanism. This upgrade has brought some rule changes to the Ethereum network, which are as follows:

Node Verification Change: The original mining nodes will be replaced by verification nodes. Verification nodes need to have 32 ETH as a deposit and run corresponding software to participate in network verification and block packaging.

The block reward has been changed: the original block reward will be cancelled and replaced by profits obtained through transaction fees.

Transaction fee mechanism change: In the new version, transaction fees will be directly paid to the validation nodes instead of the Ethereum Foundation.

Dynamic transaction fee mechanism improvement: The new version has added a new feature called "EIP-1559", which can dynamically adjust the transaction fee price, allowing users to complete transactions faster and reduce excessive fees.

State storage optimization: The new version adopts a technology called "Rollups", which stores a large amount of data on the sidechain and aggregates it to the main chain, thereby reducing the burden on the main chain and improving the efficiency and scalability of the entire system.

The improvement of contract execution method: The new version has added a virtual machine called "EVM 384", which can improve the efficiency and security of contract execution.

Overall, the Ethereum Paris upgrade has significantly improved the scalability and efficiency of the Ethereum network by improving the consensus mechanism, optimizing transaction fee mechanisms, improving state storage methods, and increasing contract execution efficiency.

At this time, the price of Ethereum is $1472 per unit.

Shanghai Upgrade - April 12, 2023

Shanghai Upgrade will be the first major upgrade after the merger of the Ethereum network, and it is an important milestone on the Ethereum roadmap. There are three main changes that will be brought about:

1. Shanghai has upgraded and unlocked the staking withdrawal function of Ethereum. This is not only beneficial for maintaining the vitality of the Ethereum network, but also for the sustainable development of Ethereum in the future, continuing to attract more validators to join the Ethereum network.

2. Reduce the gas fees for Layer-2 solutions running on the Ethereum blockchain, which to some extent makes Ethereum faster and cheaper. The Shanghai upgrade will further optimize the gas fees for transactions on Ethereum.

3. As the largest blockchain network supporting smart contracts, Ethereum will maintain its leading position in this field through the introduction of EOF (EVM Object Format) in the Shanghai upgrade.

At this time, the price of Ethereum is $1917 per unit.

Cancun Upgrade - Q4 2023 (estimated)

The Cancun upgrade is an additional upgrade to the ETH blockchain following the Shanghai upgrade, which includes EIP-4844 and possibly EIP-6969. The main goal is to promote the cost reduction and speed increase of Ethereum L2. By then, the speed of Ethereum Layer2 will be increased by 10 times, and even have the opportunity to increase by 100 times with lower costs.

The fees on Ethereum Layer1 have always been high and urgently need necessary improvements to reduce overall operating costs. Currently, the main solution for expanding on Ethereum is Layer2 Rollups. Rollups have indeed helped users save a lot of Gas Fees, such as the project Optimism, which has a regular Gas Fee expense of only 0.001 gwei, far lower than the regular expense of Ethereum's Layer 1 mainnet. ZK Rollups' solution has better data compression performance and does not require signature data, making it even cheaper, and can even be reduced to one percent of the Ethereum Layer 1 mainnet. However, for a wider range of users, even with Rollups solutions, Gas Fees are still a relatively expensive burden. In addition, Ethereum's efficiency in processing parallel transactions is still relatively low, and it can only process double-digit transaction volumes per second at most, which requires new improvement solutions to help improve scalability.

Sharding is a powerful improvement method to solve the above problems, but it cannot be implemented in the current Ethereum. The timely proposal of the improvement plan EIP-4844 is a compromise between the above requirements and the implementation of shard upgrade, which lays the technical foundation for the overall data sharding of Ethereum in the future. Therefore, EIP-4844 is also known as "Proto-danksharding".

EIP4844 introduces a new transaction type to Ethereum that allows data to be stored in a space called Blob at a lower cost, enabling data previously stored in Layer1 before Layer2 to exist in Blob, greatly reducing the cost of Layer2.

Aside from the highly anticipated EIP-4844, the improvement proposals confirmed for implementation in the Cancun upgrade include:

EIP-1153: Add Transient Storage Opcodes. Transient storage is a solution specifically designed to address communication within blocks.

EIP-6780: Modify the functionality of the SELFDESTRUCT opcode in preparation for the Verkle Tree architecture for future Ethereum applications.

除了 ETH 本身，坎昆升级下还有一些值得布局的项目

Other than ETH itself, there are some projects worth laying out in the Cancun upgrade

Layer2

The biggest beneficiary of the Cancun upgrade in the encryption industry is undoubtedly Layer2, which has sufficient first-mover advantages. Arbitrum and Optimism, as the leaders of L2, are worth paying attention to. Meanwhile, leading applications in the Arbitrum ecosystem, such as GMX, RDNT, and Magic, will also rise with the explosion of L2. In addition, projects based on OptimisticRollup, such as Metis, and projects that imitate Optimism, such as Boba Network, are also expected to benefit from the Cancun upgrade.

ZK-Rollups

zkRollup, considered as a more advanced solution in the industry, is expected to shine with the upgrade of the Kankan. zkSync, StarkNet, and Scroll are the three most well-known projects in this field. These three projects have not yet been issued, but their potential should not be underestimated.

zkSync is an extension solution developed by Matter Labs based on the ZK-Rollup architecture. It is mainly aimed at the 1.0 mainnet for payment purposes and the general 2.0 testnet that is fully compatible with EVM. Recently, zkSync has also upgraded its 2.0 entrance, supporting the payment of network fees with any token, greatly improving user flexibility.

Starknet is a decentralized Validity-Rollup that runs as an L2 on Ethereum, allowing any application to scale massively without compromising Ethereum's composability and security.

Scroll is a zkRollup based on zkEVM on Ethereum, serving as an L2 solution to address Ethereum's congestion issues.

Other

除了上述两个大类，坎昆升级还会利好其他集中类型的项目。包括和 L2 功能相近的跨链协议；由于 Blob 数据保存时间短，因此会利好数据可用性层项目。其中的代表有：Layerzero 是目前最火的跨链协议。它是一种跨链通信协议，可以将一条链上的「信息」传递到另一条链上，通过在链上部署一系列智能合约（Endpoints）实现去中心化的信息跨链服务。

Translation:

In addition to the above two categories, the Cancun upgrade will also benefit other centralized projects. This includes cross-chain protocols that are similar to L2 functionality; due to the short storage time of Blob data, it will also benefit data availability layer projects. Representatives of these projects include: Layerzero, which is currently the most popular cross-chain protocol. It is a cross-chain communication protocol that can transmit "information" from one chain to another, and achieve decentralized information cross-chain services by deploying a series of smart contracts (Endpoints) on the chain.

Celestia is a data availability layer project. Based on the Cosmos architecture, it provides data and consensus layers for other L1 and L2, building modular blockchains. The principle is similar to Ethereum's sharding solution, which can reduce the current transaction fee bottleneck of Rollup to a certain extent, namely "data storage cost".

With the implementation of EIP-4844, L2 will be more competitive compared to other L1s, and its future development prospects are relatively promising. In addition to significantly reducing the transaction fees of L2, EIP-4844 also provides a good foundation for the future application of Danksharding, making it easy to achieve data sharding in the future. Lower transaction fees, better transaction experience, and even more application scenarios may emerge, and the Cancun upgrade will become a turning point for Ethereum L2.