January 31, 2024
The State of Ethereum Scalability: Comparing Ethereum Scaling Solutions
Navigating Ethereum's Scalability Challenges and the Path to Layer 2s
The Ethereum network was not initially designed to accommodate the sheer volume of transactions that today DApps demand. This congestion leads to slower transaction times and, more importantly, to exorbitant gas fees as users compete to have their transactions processed. These high fees can be prohibitive, especially for smaller transactions, and pose a significant barrier to entry for new users and developers.
In response to these challenges, the Ethereum community have focused their efforts on developing Layer 1 upgrades and Layer 2 solutions. Layer 1 upgrades refer to improvements on the Ethereum mainnet itself, as outlined in the roadmap Vitalik shared last year.
However, while these upgrades are critical, they are part of a long-term plan that foresees Ethereum living together with Layer 2 solutions. L2s work on top of the Ethereum mainnet and are designed to handle transactions off the main chain, thereby reducing congestion and gas fees. Layer 2 solutions include various technologies like Rollups, Validiums, Plasma, and Disconnected systems, each offering different trade-offs in terms of security, decentralization, and throughput.
The ideal future for Ethereum envisions a world where most users interact primarily with Layer 2s, and possibly Layer 3s, with the Ethereum mainnet operating as a secure settlement layer. However, as of now, this future remains a work in progress, since we are still in the midst of exploring and developing the best ways to scale the network effectively.
The goal of this article is to delve deeper into these solutions, analyze their impact, and offer a fresh perspective on what the future holds for Ethereum's scalability.
An Overview of Ethereum Scaling Solutions
Rollups scale Ethereum by executing transactions off-chain and posting them on Ethereum in batches. Optimistic and ZK Rollups diverge in the way they validate transactions. Optimistic Rollups rely on fraud proofs, while ZK uses validity proofs.
With fraud proofs, if a batch is found to have an incorrect post-state root, anyone can publish a proof on-chain demonstrating this error. The contract then verifies the proof and eventually reverts that batch along with all subsequent ones. In this case the withdrawal period (of the assets to the L1) is of approximately one week, which is necessary to allow time for potential fraud proofs to be published and acted upon.
In ZK Rollups, validity proofs are cryptographic proofs that ensure the transactions to be valid by default if proven to be so, resulting in a near instant withdrawal period, as users only need to wait for the processing of the next batch to withdraw their assets. Anyway, the verification of ZK cryptographic proofs is quite computationally intensive, affecting rollups development which tend to be slower.
Plasma solutions focus on off-chain data and computation handling, except for specific actions like deposits, withdrawals, and Merkle root submissions. Plasma initially offered substantial scalability improvements, but while Vitalik recently hinted at the return of Plasma, it has been largely overshadowed by rollups. The reasons include high client-side data storage costs and inherent limitations in Plasma that restrict its applicability beyond basic payment systems.
Validium also utilizes Zero-Knowledge proofs for scalability, but unlike ZK Rollups, it stores transaction data off-chain. This storage method offers higher scalability but at the potential cost of decreased data availability, making it a balancing act between scalability and asset safety. In Validium systems, the risk lies in data availability failure, which can potentially lead to assets being lost (but not stolen).
4. Disconnected Systems
These independent blockchains (like sidechains) are connected to Ethereum but operate with their distinct consensus mechanisms. Sidechains can process transactions and execute smart contracts with high efficiency and scalability. The trade-off, however, lies in their security and decentralization aspects, which might not be on par with Ethereum's mainnet.
While we've touched upon some of the main Ethereum scaling solutions, it's important to note that this list is far from exhaustive. The Ethereum scaling landscape is rich and diverse, with each solution offering its own unique benefits and trade-offs.
SKALE's Unique Approach to Ethereum Scaling
While SKALE can be categorized as a Disconnected System, since it can be defined as a network of AppChains that are connected to the Ethereum Mainnet, it takes a distinctive stance on Ethereum scalability, offering an innovative, and multifaceted solution through a wide range of features:
Developers have the freedom to craft SKALE chains with specific attributes, ensuring optimal alignment with their DApp's requirements.
• EVM Compatibility and Interoperability
SKALE ensures seamless transition and interaction within Ethereum's ecosystem, facilitating easy migration and integrations.
According to a study by Dartmouth Blockchain, SKALE is the world’s fastest blockchain as it delivers rapid transaction processing and instant finality through horizontal scaling. 100 chains = 39,770 TPS, 1000 chains = 397,700 TPS.
A game-changer in enhancing the Web3 user experience, SKALE removes the burden of transaction fees for end-users, fostering a more user-friendly DApp environment.
Developers can scale their applications effortlessly with SKALE's clear chain subscription pricing model, enabling effective planning and budgeting for growth.
• Instant Finality and MEV Protection
Ensuring all transactions achieve immediate finality, SKALE effectively negates issues like MEV, promoting a more reliable and trustworthy blockchain experience.
SKALE enhances AppChains possibilities giving developers the chance to implement decentralized Zero-Knowledge capabilities into their DApps.
Benefiting from a pooled security model, SKALE Chains gain robust protection through a dynamic, randomized node assignment system, bolstering defenses against potential security threats.
• On-chain File Storage and Free NFT Minting
Offering comprehensive on-chain data storage, SKALE provides free trustless NFT minting as well as on-chain AI/ML integration.
The Future of Ethereum Scalability and SKALE's Role
As the Ethereum ecosystem continues to evolve, upcoming developments are poised to significantly impact its scalability landscape. Imminent advancements such as the upcoming proto-danksharding upgrade (EIP-4844), the decentralization of rollup sequencers, and the advent of modular data availability networks, represent important innovations in the near future.
In this dynamically shifting landscape, SKALE Network is strategically positioned to contribute significantly. SKALE remains steadfast in its commitment to bolstering the Ethereum ecosystem, driven by a vision of a scalable, secure, and decentralized future. In this journey of blockchain evolution, SKALE is not just a participant but a key architect, shaping the path towards a more accessible and powerful blockchain experience.
SKALE is the world's fastest blockchain, designed for fast, secure, user-centric Ethereum scaling. SKALE chains offer zero gas fees to end-users and have advanced features such as AI/ML smart contracts, on-chain file storage, interchain messaging, zero-cost minting, and enhanced security features.
The SKALE Network enables developers to deploy their own EVM blockchain in minutes without sacrificing speed, security, or decentralization. Welcome to the SKALEverse.