Block a certain amount of Ether (ETH) to join the network and get a reward in return
The staking process involves blocking an amount of a given cryptocurrency in a wallet to participate in the operation of a blockchain in exchange for rewards. In theory, anyone can participate in staking on any blockchain that uses proof-of-stake consensus. The proof-of-stake has several variations, which allow users to participate in staking.
Currently, the Ethereum development team is working on a significant update, called Ethereum 2.0. It involves redesigning the entire Ethereum platform, effectively launching a new, more scalable version. The start of this implementation is scheduled for the summer of 2020 and will most likely last a year or two, until all three phases are completed. Part of the Ethereum 2.0 implementation involves moving Ethereum from a proof-of-work consensus to a proof-of-stake consensus.
Historically, Ethereum has used proof-of-work consensus. However, one of the reasons behind the move towards proof-of-stake is that the latter is generally considered to be much more energy efficient than proof-of-work.
Leading Ethereum developers are largely in favor of decentralization, which points to another reason for switching to PoS. In recent years, mining of the largest cryptocurrencies, including BTC and ETH, has become heavily dependent on a small number of large mining pools due to the rush to produce faster and more sophisticated hardware mining.
Conversely, anyone can operate as a PoS validator without the need for specialized hardware. As a result, the theory is that PoS blockchains are more likely to feature greater decentralization due to a reduced barrier of entry. Furthermore, Ethereum 2.0 will also introduce sharding, a partitioning technique that further increases performance.
