Ethereum (ETH) must tackle its scalability restrictions to support the growth of Layer-2 (L2) networks and to avoid future transaction bottlenecks, according to the Defi report.
The company said in a recent report that, if L2 networks, the acceptance of users and transaction transaction scale scale, competition for the limited Blob space of Ethereum could increase the costs and undermine the wider -scale route map of the network.
Ethereum supports L2S via ‘Blobs’, cheap mechanisms for data storage introduced with Ethereum Improvement Proposal 4844 (EIP-4844). However, the current capacity of three target blocks per block is in danger of becoming insufficient.
Even after the upcoming Pectra -upgrade, which will increase the target to six blobs per block, predictions suggest that fast L2 extension could surpass the available bandwidth.
Simulations show that a 10x increase in transactions per second over large L2S, such as base, arbitrum and optimism, could push transaction costs to non -durable levels and possibly reach $ 0.64 per transaction.
Although planned upgrades, such as Peerdas and Fusaka, are expected to further expand the blob capacity, projections indicate that Ethereum must support at least 33 blobs per block to keep L2 transaction costs under $ 0.02.
Without these upgrades, Ethereum risks congestion that could threaten the viability of the L2-centric scale strategy.
Basic as Case Study
Base, Coinbase’s Layer-2 Blockchain, offers a tangible example of the opportunities and challenges inherent in the current Ethereum model. Since the launch, BASE has generated more than $ 106 million in user costs, bridged more than 155 million addresses and 1.9 million ETH, which represents 1.6% of the circulating range of Ethereum.
Applications that work on the base have built up $ 768 million in cumulative costs, which reflects a significant demand for users and network activity.
Since its foundation, Base has also contributed around $ 4.5 million to Blob and settlement costs to Ethereum Layer-1 Validators, which emphasizes the intended economic synergy between L2 growth and the Ethereum income model.
Despite the success of the basis when expanding the range of Ethereum, it is also an example of the pressure exerted on the L1 infrastructure. In the past six months, Base only has an average of 93 transactions per second, a figure that, when multiplied over different scale L2S, expressed concern about the sustainable allocation of Blob space.
Although the basis stimulates the net new demand for Etehreum and reinforces the broader network through applications and the growth of the Stablecoin, whereby almost $ 10 billion in total value is currently obtained, the scale process emphasizes the urgent need for Ethereum to maintain affordability and speed for end users in all L2s.
Outlook for the L2 strategy from Ethereum
The L2 route map represents a deliberate strategic pivot for Ethereum, on its way to a business model aimed at security facility, settlement and scalability services for external networks.
In this model, L2S such as Base can load transaction activities of the mainnet while they generate economic value through BlOB costs.
However, the report argues that the success of this model depends on Ethereum’s ability to scale Blob capacity without introducing priceless costs.
If scale upgrades do not keep pace with the acceptance of L2, Ethereum could be confronted with competitive pressure of alternative solutions for data availability or even by competing L1s that can offer lower transaction costs on a scale.
Current projections suggest that if the transaction volume over large L2S is dramatically grown without proportional upgrades to Blob through, Ethereum will return to the current reimbursement levels on the base layer, so that the cost benefits are denied by the L2 strategy.
The income from Ethereum under a ten -time L2 scale scenario would be $ 1.4 billion, roughly the same as his reimbursement generation in the past year.
In summary, Ethereum’s ability to support a flourishing L2 ecosystem depends on continuous technical progress and implementation with regard to the maininet.
Not expanding Blob space can endanger its role as the backbone of decentralized applications and settlement for the next generation of blockchain infrastructure.
