Ethereum (ETH) Prepares for Istanbul Hard Fork, Nodes Still Need to Upgrade
The new upgrade was tested for months before the mainnet launch, and is the eighth hard fork for the Ethereum network.
As scheduled, the hard fork was expected close to December 6, but may be delayed as block production for ETH was sluggish in the past weeks due to slowly increasing difficulty. The fork is mostly adding backend features to Ethereum, with an upgrade to prevent spamming blocks. The Istanbul hard fork will also add more features to deploy ZK-Snarks and ZK-Starks, allowing veiled transactions.
Nodes may once again upgrade at the last moment, as 59% of Geth and 78% of Parity nodes are not ready.
The Istanbul hard fork was a high stakes upgrade, as questions were raised on whether the fork would be accepted. During the tests, some miners moved to build a rogue chain. The concept of upgrading to ETH 2.0 has sparked the discussion on whether miners would comply, and which would be the recognized Ethereum blockchain.
As the platform now carries more tokens, including Tether (USDT), and is used as a base for decentralized finance, a network split could cause confusion and immediate losses.
The hard fork for now does not bring the expected ETH rally, which was seen as a potential. ETH stepped back to $148.25 on Friday, on thinned out volumes of $6.4 billion in 24 hours.
The latest sell-off has led to an outflow from DeFi schemes. The leading Maker DAO lending operation now holds significantly less ETH, after moving to multi-collateral DAI. The ETH held as collateral fell from a peak above 1.73 million coins to 1.09 million coins.
Now, the biggest challenge for ETH would be the evolution to a new type of network. Proof-of-stake is currently being tested, and there is no final version on how block discovery would be rewarded.
The current staking version is available through testnet, to give a sample of the possibilities for Ethereum.