Beacon Chain

The Beacon Chain was Ethereum's separate proof-of-stake blockchain, running in parallel to the original proof-of-work chain from its December 1, 2020 launch until it took over as the network's consensus engine. Rather than processing user transactions or smart contracts, it functioned purely as a coordination layer: tracking which accounts had staked ETH to become validators, randomly assigning them to propose and attest to blocks, and calculating rewards or slashing penalties for misbehavior.

At genesis the Beacon Chain had roughly 21,000 validators securing it, but carried no real economic weight since it did not yet touch mainnet activity. Over the next two years deposits grew into the millions of ETH as the network prepared for "The Merge." On September 15, 2022, Ethereum's original execution layer joined with the Beacon Chain: mining stopped entirely and Ethereum switched fully to proof of stake, cutting the network's energy use by an estimated 99.95%. The Beacon Chain then became the network's "consensus layer," working alongside an execution layer client to validate every transaction and produce blocks.

One notable quirk: staked ETH deposited into the Beacon Chain could not be withdrawn until the Shanghai upgrade in April 2023, more than two years after staking began. Today the Beacon Chain's validator set numbers in the hundreds of thousands, and Ethereum researchers have discussed an eventual redesign, sometimes called the "Beam Chain," to modernize its architecture.