Lesson 12 of 24
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12. What is Ethereum Casper?

Casper is a project that aims to implement PoS into the Ethereum ecosystem. We will talk about what it is and how it works in today’s lesson. So – pens in hand and welcome to the reading. 

PoW vs Pos 

Before we move on to explain the definition of Ethereum Casper, we need to remind  ourselves of the basic differences between the PoS mechanism and PoW. We know that both algorithms are the most commonly used consensus mechanisms. The main idea of PoW is that miners compete to solve a complex cryptographic puzzle. The winner creates a  new block on the blockchain and receives a reward. 

In PoS, on the other hand, miners ‘block‘ their cryptocurrencies as stakes. In this mechanism,  validators approve the block, depending on the weight of its stakes. 

Ethereum Casper – definition 

Ethereum Casper is a hard fork of Ethereum that solves several key issues between the network and its mass adoption. It aims to make the ecosystem more scalable, combat centralisation and change the PoS protocol to PoW. Ultimately, Casper is expected to  transform the current version of Ethereum, to update 2.0. It has been given the name  ‘Serenity’. 

Ethereum Casper comes in two versions: 

Casper the Friendly Finality Gadget (FFG) – will be used to transition from PoW to PoS consensus. Basically, we can say that it is a hybrid of the two mechanisms. PoW is used to create new blocks, and Casper the FFG comes in the form of smart contracts overlaid on the blockchain. The aim of such a procedure is to make a smooth transition to PoS. Casper the Friendly Gost: Correct by Cinstruction (CBC) – its implementation is being handled by developer Vlad Zamfir. CBC Casper is a security oracle and tunes the PoS protocol. 

Casper will be implemented in two phases: 

Phase 0: Beacon Chain. It will be a new blockchain (sidechain), running in parallel to the  Ethereum master chain. In this phase, the PoS concept will be introduced to the Ethereum blockchain. The Beacon Chain will be tasked with managing and coordinating validators without the need to create smart contracts or have a user account.  

Phase 1: Sharding. This phase will split the Ethereum network into multiple shards. This will provide tremendous scalability as each shard will process transactions in parallel. Recall that low scalability is Ethereum’s biggest problem facing the ecosystem. 

Casper protocol – advantages 

It is environmentally friendly. The PoS system validates transactions faster, easier, and without using a huge amount of computing power. As a result, miners do not consume as much energy as with PoW. This results in lower power consumption costs and a much lower environmental impact. 

Greater scalability – The Casper protocol uses a different validation method. It allows more transactions to be processed per second. As a result, they are faster and cheaper. 

Energy efficiency – in the long term, this will increase the amount of Ether in  circulation. 

Ethereum Casper will eliminate the threatening centralisation of Ethereum mining.

∙ It will reduce the risk of attack 51%. 

∙ Validators will act in the best interests of the network. 

∙ Will reduce the issuance of new coins. 


The Casper hard fork is a complex and significant update. Moreover, it affects one of the largest and most recognisable cryptocurrencies in the world. The change in consensus from  PoW to PoS is also a big deal for Ethereum as a whole. So we look forward to seeing how it all unfolds, among other things, in the case of cryptocurrency exchanges.

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