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That’s how much scalability has already improved

According to Vitalik Buterin, the scaling improvements are already incremental. However, ETH 2.0 might be the only feasible solution after all.

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In a conversation with Bloomberg, Ethereum founder Vitalik Buterin spoke openly about various aspects of Ethereum – including perhaps the most difficult problem it has had to struggle with so far: scalability.

The Ethereum ecosystem has the most dApps and the highest total value tied in native DeFi protocols. However, some say that ETH has become a victim of its own success – which manifests itself in high gas charges and a system with bottlenecks.

The current throughput for Ethereum is around 10 transactions per second (TPS). In contrast, Ripple’s XRP supposedly manages 1,500 TPS consistently, but can even handle up to 65,000 TPS.

In order to take out the competitors, Ethereum must overcome its scalability problems.

Ethereum and its scalability problem

Presenter Emily Chang describes the above problems as “growing pains” – which leads to the question of why they exist in the first place.

In response to this question, Buterin simplifies the problem by presenting it as a problem of supply and demand. According to Buterin, competition among users for the limited block capacity is driving up transaction fees.

“If the number of people wanting to send transactions increases, but the amount of space for transactions on the chain does not increase, then all of these people who want to transact are bidding against each other. And only those who are willing to pay a really high amount can actually get in. “

Buterin admits that the only way to solve the problem is to increase the transaction capacity to handle more user traffic.

Since the beginning of Ethereum, the development team has made incremental improvements, according to Buterin. To date, these upgrades have increased scalability by a factor of five, according to the programmer:

“We’ve made all kinds of incremental improvements to the blockchain clients and protocol code over the past five years. Ethereum’s scalability has increased roughly fivefold since the project began. “

The London Hard Fork and EIP 1559

As part of the most hyped recent improvement, EIP 1559 went live with the London Hard Fork earlier this month.

When the developers first presented the proposal, they sold it on the premise of counteracting rising gas charges. But only by making them more predictable. That doesn’t necessarily mean lower gas charges, even if users were hoping for it.

Recently, Buterin claimed that on-chain capacity to London had increased by 9%. In theory, this should have resulted in lower fees as there is less competition for block space.

However, an analysis of average gas prices shows a slight increase since it was launched in London. It is currently 57 gwei compared to 46 gwei on August 4th (the day before the hard fork).

Average Ethereum Gas Prices, SOURCE: ETHERSCAN.IO

Maybe it’s too early to say EIP 1559 wasn’t worth the effort. In any case, the developers always maintained that the introduction would not lead to lower gas prices.

But: After an initial test, ETH 2.0 is perhaps the only way Ethereum can completely solve its scalability problem.

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Proof of text: Cryptoslate

Last updated on August 20, 2021

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Hasan Sheikh
Hasan, who loves technology and games, is studying Computer Engineering at Delhi JNU. He has been writing technology news since 2016.


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