Ethereum Casper v2 Updates: Proof Of Work, Sharding, Plasma & FFG Upgrades

Ethereum's team continues to retouch its network and expects to scale Ethereum to one million transactions per second.

The long-awaited Ethereum update known as ‘Casper FFG' has been replaced by a hybrid update called ‘Casper v2‘. It will combine two different types of updates: ‘sharding' and ‘proof-of-work'.

What Does Ethereum Casper v2 Consist Of?

As such, Ethereum is a blockchain that allows anyone to write and execute their own smart contracts. You can do all kinds of stuff on it, even things that make you a direct competitor of Ethereum. It is so widely used that one unit of your cryptomoney, Ether (ETH), will cost you $500 per piece at the moment of writing.


Casper is the name of an update of Ethereum's blockchain. It was initially proposed in November 2017. Fundamentally, it is a shift from a consensus system of proof-of-work (PoW), which Ethereum currently uses, to a proof-of-stake (PoS).

It is important for Ethereum to stop being proof-of-work if it wants to become a scalable system, that is, if it wants to be able to handle the million transactions per second needed to become the world's proposed computer.

What Works on the Background?

Proof-of-work (PoW) describes a blockchain in which users compete to verify each new block, meaning that computers solve a mathematical problem. A verified block is added to the chain and the winning user is given some cryptocurrency as a reward, in a process known as mining. The advantage of this system is that it creates a “block-chain” in the original sense of the word; open, decentralized, infallible, transparent, efficient and secure. Bitcoin is powered by PoW.

The disadvantages here are that computing power is monopolized, so that people with rooms full of specialized machines do all the mining.

Proof-of-stake (PoS) means that mining power is not defined by the power of your computer, but by the number of relevant cryptocurrency tokens that you own; that is, one coin, one vote. Nodes sign a block they wish to mine, and have a random chance of success. The more coins you have, the greater the chance. The advantage of this is that the system will work faster. Users with high stakes should have no incentive to cheat the system because that would only undermine the value of their holdings.

The disadvantage of this system is what is called a “nothing-at-stake”: Users can log in to each block because they are not risking anything; no energy is being wasted from the computer. This means that the number of forks could increase exponentially, as exclusive approval of the main chain is not encouraged. This would undermine the integrity of the system.


Casper was the solution to the “nothing-at-stake” problem invented by the Ethereum team. In order to potentially mine blocks, nodes must store an amount of Ethereum (ETH) in a designated wallet, part of which will be lost in the event of malicious behavior.

Casper FFG (Friendly Finality Gadget) is one of two versions of the main idea, and was supported by the company's founder, Vitalik Buterin. Basically, it is a hybrid system of proof-of-work/proof-of-stake that works mainly with the former, but stops from time to time to validate every fifty blocks through the latter.

Sharding is another proposed way of accelerating Ethereum. Basically, it means that an additional subordinate chain fed by PoS would join Ethereum's main blockchain. It would allow people to use this secondary system and thus lighten the load on the main system.

Beacon-chain makes room along the main blockchain. It creates a new block automatically every few seconds and would randomly find a node to validate it through the PoS mechanism. These fragmented blocks would be where transactions and accounts are stored. All of them would be defined by the main proven main block chain of work and added to it through cross-links.

Now Casper 2.0 (Hybrid Version)

Justin Drake of Ethereum's Sharding research team said through Reddit:

“We are considering changing the Ethereum 2.0 roadmap to skip Casper FFG with 1500 ETH deposits. Instead Casper and sharding validators would be unified from the get-go in the beacon chain, and deposits would be 32 ETH.”

This will essentially change the system's dependence on the central PoW chain to the beacon-chain itself. Most business is done there, and the chain is validated in the main chain at intervals. Eventually, the PoW chain will become extinct. And this proposal is now 80% complete.

Buterin said at a recent conference that he believes Ethereum could support a million transactions per second, given the correct updates:

“So if you get a 100x from sharding and a 100x from Plasma, those two basically give you a 10,000x scalability gain, which basically means blockchains will be powerful enough to handle most applications most people are trying to do with them.”

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