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Ethereum 2.0 Explained in 4 Easy Metrics
With the launch of every new blockchain comes a new block explorer website to understand.

Block explorer sites offer real-time updates on network activity. Normally, they feature information on blocks, transactions and fees. On Ethereum 2.0, the block explorers depict a very different array of metrics involving epochs, slots and attestations.

But even for those familiar with the usual Ethereum explorers such as Etherscan, Etherchain and Blockchair, the new sites for tracking Eth 2.0 activity may be difficult to decipher. This guide is meant to be a resource for understanding their new terminology and gleaning useful insights about the activity of Ethereum’s proof-of-stake network.

For anyone unfamiliar with blockchain explorers in general, this guide will go over the basic details of reading an Ethereum 2.0 blockchain explorer. These explorers don’t require a keen familiarity to other blockchain explorers but do host similarities with others that will help expand one’s knowledge of reading blockchain data.
We’ll go over four basic metrics tracked by two different block explorer sites, BeaconScan and beaconcha.in. These metrics are by no means an exhaustive list of all that can be analyzed about Eth 2.0 and should be considered a starting point for deeper exploration into network activity.

Epochs progressed
Unlike Bitcoin and Ethereum, Ethereum 2.0 progresses in epochs, not blocks. An epoch is a bundle of up to 32 blocks that actors on the network (called validators) propose and attest to over a period lasting roughly 6.4 minutes. An epoch, along with all the blocks of which it is composed, is only considered finalized after the progression of two more epochs after it.
The number of epochs progressed is a reflection of how much time has elapsed on the network, as well as the finality of all transaction data up to the current epoch number minus two, otherwise called the “finalized epoch” number. (See image above.)

This metric can be a useful indicator of any network abnormalities. Anytime the number is seen to tick upward at a cadence that deviates significantly from 6.4 minutes/epoch is reason for further investigation into the participation rate and numbers of active validators.

Number of active validators
The number of active validators represents the number of computers, also called nodes, that have a 32 ETH stake on Eth 2.0 and that have passed the activation queue for entry into the network. As of Jan. 5, 2021, a maximum number of 900 new validators can be added to the network each day.

A total of 262,144 validators is needed at minimum for Eth 2.0 to advance to its next phase of development in which 64 mini-blockchains, called “shards,” will be spawned. At the current rate of 900 new validators being added to the network each day, phase 1 will occur sometime in late August or early September of this year.

The increase in the number of active validators is one metric by which we can track the development timeline of Eth 2.0. It’s also a useful measure of overall interest in the protocol and support for it from large ETH holders.

Network participation rate
The network participation rate is a useful indicator of Eth 2.0 network health. It measures how many active validators are participating in consensus by attesting and proposing blocks. Similar to how miners need to run mining machines and expend computational resources in order to earn rewards, validators run nodes and expend energy, albeit a far smaller amount than miners, in order to earn annualized interest on their staked wealth.

A participation rate of 99% suggests the vast majority of validators on Eth 2.0 are doing their job and securing the network. Significant declines in this number would suggest active validators are shutting their nodes down and disconnecting from Eth 2.0.

Read more: Ethereum 2.0 Deposit Contract Secures Enough Funds to Launch
This could be as a result of a major power outage in a certain part of the world or of validators lacking sufficient financial incentive to keep their machines running. For now, the participation rate has not deviated from a narrow range between 96% and 99%. However, its change over time will give clues as to how engaged Eth 2.0 validators are with earning rewards on the network.

Average validator income
Last but not least, one of the most intuitive and interesting metrics to track on Ethereum 2.0 is how much validators are earning on average, daily. Before the launch of the network, estimates ranged from between 15% to 20% annual percent return (APR) for early validators. As of Jan. 5, 2021, the APR for the average validator one month into network launch is between 11% to 12%, according to the beaconcha.in calculator.

On block explorer BeaconScan, validator rewards are broken down by day. For the past two weeks, validators have been earning roughly 0.008 ETH/day, which is valued at around $8.86/day at time of writing. Initially, the daily average had reached as high as 0.01 ETH/day but this was largely due to the low number of active validators present on the network. The reward system of Eth 2.0 is dynamically structured so that an increasing number of Eth 2.0 validators will trigger lower validator returns and vice versa.

Taking a look at the lowest daily average recorded thus far, which is 0.005 ETH/day on Dec. 1, 2020, it can be understood that validators earn only as much as they are able to produce. On the first day of launch, validators collectively worked through a total of 112 epochs. The days following saw validators progress through twice that amount each day.

Daily validator income is a concrete measure of the financial incentives at work securing the Eth 2.0 network. Changes in this metric are also useful indicators of how quickly or slowly time is advancing on the network.

Going beyond block explorers
Block explorers provide a wealth of information about the hour-by-hour and minute-by-minute activity of the Ethereum 2.0 network. They’re also free to use and available to the public.

Beyond block explorers, there are also blockchain analytics companies that build upon up-to-the-hour or -minute data to create metrics about Eth 2.0 spanning longer time horizons.



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