What is Blockchain 2.0?
The meaning of Blockchain 2.0, also known as "smart contract" platforms, refers to an evolution of the original blockchain technology and the second generation of blockchain-based systems. Unlike the first generation, which mainly focuses on the transfer of cryptocurrency, Blockchain 2.0 provides the ability to execute self-executing contracts and automate the process of recording and verifying transactions. This technology has the potential to streamline many industries and change the way we interact with technology and finance.
One of the most significant differences between Blockchain 1.0 and 2.0 is the introduction of smart contracts. A smart contract is a self-executing program that automatically executes the terms of a contract when certain conditions are met. These contracts can be used to manage a wide range of transactions, from the transfer of assets to the execution of complex financial instruments.
Blockchain 2.0 also offers increased scalability and improved security features, such as faster transaction speeds and more robust security protocols. Additionally, these platforms are designed to be more flexible, allowing developers to build decentralized applications (dApps) on top of the blockchain, extending its capabilities even further.
One example of a blockchain 2.0 platform is Ethereum, which provides a platform for the creation and execution of smart contracts and decentralized applications. With its ability to host a wide range of dApps and support for multiple programming languages, Ethereum has become one of the leading blockchain 2.0 platforms and has attracted a large and growing community of developers and users.
Simplified Example
Blockchain 2.0 can be compared to an upgrade of a traditional ledger system to a more advanced and versatile one.
Imagine you have a regular ledger book where you keep a record of all your transactions. Blockchain 1.0 would be like having a ledger book where each page is a block, and the blocks are linked together to form a chain. But now, imagine upgrading this ledger book to one that not only records financial transactions but can also store other types of data like property titles, voting records, and more.
This upgraded ledger book, or Blockchain 2.0, has the ability to execute smart contracts - self-executing agreements with the terms of the agreement directly written into lines of code. With this upgrade, the ledger book can now handle more complex transactions and applications, making it more useful and versatile.
Who Invented Blockchain 2.0?
The term "blockchain 2.0" was first used by American Ethereum developer and Parity Technologies co-founder Gavin Wood in a 2016 blog post. In the post, Wood outlined his vision for a new generation of blockchain technology that would be more scalable, efficient, and secure than the original blockchain developed by Bitcoin.
Wood's significant role in Ethereum's creation, particularly his work on designing the Ethereum Virtual Machine (EVM) and the Solidity programming language for smart contracts, contributed to shaping this era of blockchain advancement. His involvement in Ethereum and the development of these groundbreaking technologies positioned him as a key influencer in the evolution and expansion of blockchain capabilities beyond simple transaction processing.
Examples
Ethereum: Ethereum is a decentralized platform that uses blockchain technology to enable the creation of smart contracts and decentralized applications (dApps). It is often considered the first and most prominent example of blockchain 2.0 technology.
EOS: EOS is a blockchain platform designed for the development and hosting of decentralized applications. It aims to provide high scalability, flexibility, and usability for developers, and uses a delegated proof of stake (DPoS) consensus algorithm.
NEO: NEO is a blockchain platform that aims to digitize assets using smart contracts. It supports multiple programming languages and is designed to be more accessible for developers compared to other blockchain platforms. It also uses a delegated Byzantine Fault Tolerance (dBFT) consensus algorithm.
Related terms
Blockchain: Blockchain is a decentralized, digital ledger that records transactions across a network of computers.
Contract: In the world of cryptocurrency, a contract is a self-executing agreement that is recorded on a blockchain.