• Ethereum developers have started to refer to the upcoming hard fork as “Shapella”, as it is a combination of the Shanghai upgrade on the execution side and Capella on the consensus side.
• To understand what Shapella is, one needs to understand Ethereum prior to when it went through its last upgrade, called the Merge.
• The Merge was done by merging together two layers of the blockchain: an execution layer (proof-of-work) and a consensus layer (proof-of-stake).
What is Shapella?
Ethereum developers have started to refer to the blockchain’s upcoming hard fork – in this case a key upgrade – as “Shapella”. Shapella is technically not wrong to call it the Shanghai upgrade, but this is confusing since crypto traders, analysts and industry executives have mostly referred to the hard fork – expected by next month – as “Shanghai.” This is because Shapella combines both Shanghai on the execution side and Capella on the consensus side.
Understanding Ethereum Prior to Merge
To understand what Shapella is, one needs to understand Ethereum prior to when it went through its last upgrade, called the Merge. Ethereum’s old proof-of-work blockchain was also known as the execution (application) layer. When Ethereum started its proof-of-stake (PoS) chain, also known as the consensus layer, developers were originally going to transition over just PoS chain. But they decided that would be too complicated so they merged both chains together instead – hence ‘Merge’.
Merging Process Explained
The two layers had different names: The execution layer underwent what was called ‘the Shanghai Upgrade’ while on consensus layer it was known as ‘Capella’. As such developers cleverly merged these two names together into ‘Shapella’. By merging these two layers together they could transit from proof-of work system towards proof of stake system more efficiently and smoothly without making any drastic changes in system architecture or network topology.
Benefits Of Merging Layers
The benefits of merging these two layers are plenty; for example miners are now able to use their computing power more efficiently by using less energy than before due which will ultimately reduce electricity costs for miners significantly. Additionally it helps increase scalability thanks in part due improved data structure which allows more transactions per second than before merge process took place; meaning faster transaction speeds than ever before! Lastly Etherum has become even more decentralized with new staking capabilities enabled after merge process completed successfully.
Conclusion
In conclusion, Shapella combines both Shanghai upgrade on execution side with Capella on consensus side resulting in smoother transition from proof-of work system towards proof of stake system with many added benefits including lower electricity costs for miners, improved scalability and increased decentralization among others!