One of the biggest issues that have affected the rise and dominance of cryptocurrencies and blockchain projects has been the difficulty in scaling. Bitcoin has seen issues when the blockchain picks up interest, as has Ethereum with the likes of CryptoKitties.
These concerns are of course being addressed, especially in the case of Ethereum as the project moves to its second iteration and a change in consensus protocol. This move to ETH 2.0 will also see sharding come to the fore.
However, the solutions to scaling Ethereum, and similar projects, is still a while away. So, in the meantime, Ethereum’s founder and chief scientist, Vitalik Buterin has called for users to move over to scaling solutions that are “already here for many classes of applications.”
speaking at the opening keynote of CoinDesk’s invest: ethereum economy virtual conference, to reiterate his enthusiasm for so-called layer 2 scaling solutions such as “rollups,” which essentially means keeping transaction data on-chain while pushing the computational load off the chain.
Be aware of Rollups
“If you’re listening to this and you are an exchange or you are a wallet or you are a mining pool or you are a major user – even just a regular – then you should be aware of what rollups are and what they do,” said Buterin. “Basically, what your strategy is, in terms of moving over to them.”
This call comes at a time where Etheteum is again feeling pressure and fees are rising as the scaling issue rises its head. DeFi has taken to Ethereum and caused transaction fees to increase from 8 cents at the start of this year to highs of around $14 in September.
“In terms of where we are now, for simple payments we are actually there, like you can do ETH transactions inside rollups. The challenge is just getting everyone to actually move over,” Buterin said. “Generic EVM [Ethereum Virtual Machine] application smart contracts are a bit further behind.”
Moving to POS
Speaking on the proof-of-stake move,, Buterin said stakers could expect to be net-profitable as long as they stay online at least 50%-60% of the time.
“Some of the other proof-of-stake chains that are coming out [are] saying if you’re offline for 12 hours you get slashed, which kind of, I think, is absolutely insane,” he said.
The more coins staked, the more resources and complexity to be expected, Buterin said. That’s because the staker of 10,000 ETH will participate in many more parts of the chain than someone just staking 32 ETH, for example.
“This is a natural consequence of how sharding works and it’s actually a feature that we really like,” he said. “ETH 2.0 strives to be maximally little-guy friendly.”