Update as of 7/19/2012
* Implemented inheritance of locales. Inheritance is declared in `app/locale/<locale_name>/config.xml`
* Moved declaration of modules from `app/etc/modules/<module>.xml` to `app/code/<pool>/<namespace>/<module>/config.xml`
* Implemented ability to match URLs in format `protocol://base_url/area/module/controller/action` (as opposite to only `module/controller/action`), utilized this feature in backend (admin) area
* Added product attribute set "Minimal Attributes", which consists of required system attributes only
* Improved customers import:
  * Implemented "Delete" behavior for importing customers, customer addresses and financial data
  * Implemented "Custom" behavior, which allows to specify behavior for each item directly from the imported file
* Updated performance tests:
  * Enabled Product View, Category View, Add to Cart, Quick Search and Advanced Search scenarios
  * Added ability to specify configuration parameters per scenario and refactored bootstrap of performance tests
* Implemented `mage.js` for base JavaScript initialization of the application
* Implemented new JS translation mechanism. JavaScript translations are loaded by locale code stored in cookies
* Implemented unit tests for JavaScript widgets in Visual Design Editor
* Added jQuery plugins: Cookie, Metadata, Validation, Head JS
* Fixed issues:
  * Impossible to add configurable product to the cart
  * Impossible to apply Shopping Cart Price Rule with any conditions to cart with simple and virtual product
  * Memory leak in email templates
  * Impossible to place order with Multiple Addresses using 3D Secure
  * Required product attributes are not exported
  * "Forgot Your Password" link on checkout page inactive after captcha reloading
  * Validation of "Number of Symbols" field in Captcha configuration doesn't work
  * Other small fixes
* GitHub requests:
  * [#37](https://github.com/magento/magento2/pull/37) -- fixed particular case of "HEADERS ALREADY SENT" error in WYSIWYG thumbnail
  * [#39](https://github.com/magento/magento2/pull/39) -- added `composer.json`
  * [#40](https://github.com/magento/magento2/pull/40) -- fixed generation of "secret key" in backend URLs to honor `_forward` in controllers
Update as of 7/26/2012
* Implemented Magento Validator library in order to have clear solid mechanism and formal rules of input data validation
* Moved translations to module directories, so that it is much more convenient to manage module resources
* Updated inline translation mechanism to support locales inheritance
* Implemented ability to navigate through pending reviews with Prev/Next buttons, no need to switch to grid and back
* Fixed issues:
  * Unable to use shell-installer after changes in Backend area routing process
  * Incorrect redirect after entering wrong captcha on the "Forgot your user name or password?" backend page
  * Translation is absent for several strings in Sales module `guest/form.phtml` template
  * Exception during installation process, when `var` directory is not empty
  * Node `modules` is merged to all modules' config XML-files, although it must be merged to `config.xml` only
* GitHub requests:
  * [#39](https://github.com/magento/magento2/pull/39) -- added `composer.json`, which was announced at previous update, but mistakenly omitted from publishing