Ether (ETH) price nearly hit a new all-time high on October 21, before dropping below $4,000 after the $435 million options expired on October 22, spoiling the mood. The Ethereum network is set to take another step towards Ethereum 2.0 on October 27 in the 74240 era with the upgrade of Altair to Beacon Chain. Eth2 will be the full Proof of Stake (PoS) network that the community has been preparing for over a year.

According to a blog published by the Ethereum Foundation explaining the development, Altair is an update to the Beacon beacon chain that provides support for light clients while calculating inactivity leaks in front of the validator, increasing the severity of cuts, and cleaning up validator rewards that simplify management reporting. This is the first planned update for the Beacon series.

The blog post says this update is a warm-up for Beacon Chain and its affiliates. Essentially, the update will bring several key features of the Ethereum 2.0 network.

First, the introduction of sync commissions for lightweight client functionality allows lightweight clients to easily sync the header chain with low computation and data costs.

Second, the incentive accounting reforms introduce three major changes: Retention activities use a more efficient bit-field format that reduces complexity, and quadratic “passive dropout” is validator-based rather than globally, which is irrelevant for participating validators more than 80% of the time – There are some bug fixes in calculating the bonus.

Du Jun, co-founder of crypto exchange Huobi Global, told Cointelegraph: “If the chain stops completing after two weeks, Pre-Altair will lose completely inactive validators ~11.8% of the balance, and active validators will lose ~75% of the time. ~3.1%. According to Altair, the loss for a completely inactive validator would be ~15.4%, but the loss for 75% of the active validator would be only 0.3%.” This would make idle leakage more forgiving, to be honest. But non-standard auditors.”

Third, the update introduces changes to the penalty criteria that make inactivity leaks and cuts tougher than in the pre-Altair era. These parameters will undergo three major changes. The inactivity penalty rate is reduced by 25%, reducing the time taken to drain leftovers by approximately 13.4%. Minimum deviation coefficient lowered from 128 to 64 – the coefficient is the smallest part of the total balance that the deviation checker will lose. This sets the minimum drop fine to 0.5 ETH, which is double the previous penalty of 0.25 ETH.

The relative cut-off multiplier will also be increased from one to two, which means that the cut-off penalty will now double the percentage of other checkers that were cut within 18 days of verification. June also clarified the change: “For example, if you are laid off and 7% of the other auditors are also cut within 18 days (in both directions), the penalty for cutting will be 7% before Altair, and 14% after Altair.”

Such modifications to the incentive structure are often very important for network security, as they reward a higher degree of input and adjust the entire scope accordingly. However, at the moment, this change will not directly affect users and decentralized applications (DApps) on the network, as this update only affects the Beacon chain.

However, this will affect Ethereum users when the transition to Eth2 finally occurs. Jun said that this update will lower the threshold for users participating in Ethereum 2.0:

“One of Altair’s main goals is to make the lightweight client simple and efficient enough to operate in any environment (mobile device, embedded devices, browser extensions, and even within another blockchain smart contract).”
Redistribution of auditor benefits will lead to a change in the structure of rewards and penalties for auditors, which will make incentives for network participants more systematic and understandable through logical reasoning.

Warm up to combine
It makes sense for this update to be launched as a warm-up for future Beacon Chain updates, as the financial costs are relatively small at the moment. Since the node operators have already encountered simultaneous updates of the chain, any upcoming updates en route to the merge should be evenly rolled out, which is most important as a large amount of money will be invested in the network after the merge.

Ben Edgington, Ethereum developer and owner of Teku’s Eth2 client developed by ConsenSys, told Cointelegraph about how Altair is connected to the upcoming merger:

“The Proof of Effort update known as The Merge will be the largest update in the history of Ethereum. The Altair update will give us valuable experience to ensure that Merge runs smoothly when it is ready.

Source: CoinTelegraph