On October 26, the 7th Wanxiang Blockchain Global Summit was held at the W Hotel on the Bund, Shanghai. Vitalik Buterin, the founder of Ethereum and chief scientist of Wanxiang Blockchain Lab, shared his views on the current hot issues through live broadcasting. Views on the topic Layer2 expansion. The following is the full text of the speech:
Recently at the Wanxiang Summit, I mentioned it many times, and the topic that I mentioned many times at other summits is scaling, which is one of the biggest challenges facing the blockchain field. Including the biggest challenges we face today, such as the blockchain is very effective in terms of decentralization and security, but it can only handle very small transaction volumes, that is, its TPS is very limited. About a few years ago, such a blockchain state did not cause us too much problem, because there were not many users of the previous blockchain. But lately we've seen a lot of people wanting to use blockchain, and that number is growing every day. And the number of people who want to do more and more things on the blockchain is increasing day by day. Now there are various applications, such as DeFi, Gamefi, etc., and there are many application scenarios that people want to realize. This means that the blockchain must scale to provide all applications with the space they need.
There is an easy way to achieve blockchain scaling, and there is a hard way. Let me talk about the simple method first, which is to increase the block size and gas upper limit parameters, so that the transaction volume we can handle will increase significantly. However, the problem with this method is that it looks simple, but it will sacrifice decentralization. That is to achieve such expansion, by creating a huge system, in a huge system, each single node needs to process a large amount of data. Such a system is likely to lose decentralization, because few people operate such a large node.
Another method to achieve blockchain expansion, which is also more sustainable, is Layer 2 technology. Layer 2 technology is complex, there are some Lightning Networks, in addition, some applications have already used state channels, and some applications use some other solutions.
The most common technique we've seen is Rollup. The idea behind this technology exists in many different forms. It started in 2014 and formally took shape in 2019. I published a blog post in 2019, as shown in this PPT, I wrote a Rollup-based technical route. I wrote in it that we need to expand, but for Ethereum, it takes a long time to achieve native expansion, that is, to implement sharding. In each shard, transactions can be processed, and to achieve In this case, many technical challenges need to be overcome, and it will take a long time. Therefore, we have to wait for a long time before we can truly realize the sharding expansion performed natively by Ethereum. The solution we have now is Rollup. We have seen different versions of Rollup projects on the market. We know that Rollup is useful and universal. Rollup can greatly improve scalability, at least 100 times so far. Data sharding is a relatively simple form of sharding. It does not create a powerful shard that can process transactions. Instead, we only create shards that can store and verify data. This is a simple form of sharding .
Through such sharding, we can improve the scalability of Rollup, which can be increased by another 100 times. Everyone knows that through Rollup to achieve expansion, Rollup can provide us with expansion, and we know it well. For Ethereum, Rollup is the only feasible scalability solution.
The difference between last year and this year is that when we used Rollup for capacity expansion last year, most of them were just theoretical projects. Loopring already existed last year, and other projects did not exist, but this year many Rollup projects launched their own mainnet, and their transaction fees are now much lower than those of Ethereum. In fact, I also think that these numbers, that is, its transaction fees will drop further, and I also see a lot of optimization in this regard. As for how to use Rollup, the amount of data that needs to be stored on the chain can be reduced. Through this method, the Gas fee required for Rollup transactions can be further reduced. For example, Loopring has used a lot of optimization solutions, and Loopring is at least 30 times cheaper than Ethereum.
There are also Arbitrum one and Optimism, the two Rollup schemes, which currently do not implement any optimization, but they are working hard. These two Rollup schemes also become cheaper once they are included in the optimization scheme. Therefore, with such a Rollup scheme, the transaction fee can be greatly reduced. At least it can be much lower than last year's transaction fee. If sharding can be realized, the transaction fee can be further reduced.
Now we can see that there are various Rollup technologies on the market, and Rollup itself has many technical components. There are two main branches of Rollup today, one is Optimistic Rollup, which uses a security scheme, and the other ZK Rollup uses zero-knowledge proof. As for Optimistic Rollup and ZK Rollup, they have different advantages. For Optimistic Rollup, its technology is simpler, so it is relatively easier to build Optimistic Rollup, especially for general-purpose applications, such as general-purpose applications such as Ethereum smart contracts. The ZK Rollup technology is more complex, and its benefits are higher security and support for quick exit, unlike Optimistic Rollup, which needs to wait a week for exit. As far as technology is concerned, ZK Rollup's technology is not yet fully mature, but I think ZK Rollup will be able to support the full version of the Ethereum Virtual Machine in a few years, and everyone can use ZK Rollup technology. In the short term, Optimistic Rollup is a viable option, but in the long run I prefer ZK Rollup. Once we have data shards, ZK Rollup will have other applications as well. And I'm also thinking about some enterprise-level applications. Once ZK Rollup matures, enterprise-level applications will become possible. There is no need to use a separate chain, you can use ZK Rollup, ZK Rollup is connected to Ethereum, its cost is still very low, and you can also get a benefit, that is, you can interconnect with the Ethereum ecosystem and get Ethereum The benefits provided by the public chain.
This technology has made great progress. For example, many projects have gradually migrated their applications to Rollup. In other words, there are many projects that have already begun to think about how to build their own projects in Rollup. But there is still a lot of work to be done step by step, such as applications, or infrastructure, etc., there are still many things to do.
If you are an application developer, you must actively seek to find out how to migrate your application to Rollup as quickly and safely as possible. For non-financial applications, it is more important to migrate to Rollup, because it can reduce fees as much as possible. After all, reducing fees is very important for non-financial applications, because their users are not willing to pay such high transaction fees . In addition, many applications are a complete system, that is, if users use this application, they hope to be able to interact with other applications. For example, games, take the Dark Forest game as an example, this is a completely credit-free game based on Ethereum, this game is a good example. It continues to run on the test network now, and it can also be migrated to Rollup in the future, and NFT can also be migrated to Rollup. In other words, infrastructure can be migrated to Rollup, and financial services can also be migrated to Rollup, such as applications that use cryptocurrency for payment, can also be migrated to Rollup, and DAO can also be migrated to Rollup soon Rollup inside.
For different applications, the entire migration process is very different. Each application must consider whether to completely migrate to a Rollup, support all Rollups, or continue to exist on Ethereum but establish a cross-chain bridge with Rollup. Of course, there are many path options behind the implementation, and each option needs to be considered. Next, I will talk about the core part of the entire ecosystem-infrastructure.
For users, infrastructure is key. ENS stands for Ethereum Domain Name System, which is a decentralized domain name system based on Ethereum. ENS is a very important infrastructure. Many Ethereum users use ENS. For example, I have an ENS domain name, and many Ethereum users also have ENS domain names. My own blog, also has an ENS domain name. If you go to my blog, you can see it. In the future, I expect more and more people to use ENS. The current problem of ENS is that all functions are implemented on the main network, which leads to very high transaction fees. This is exactly the challenge we face in terms of infrastructure . As we migrate ENS to Rollup, ENS can live in Rollup, (this issue will hopefully be resolved).
The second infrastructure is light clients. If we want to make the Ethereum system truly decentralized, we need a secure light client, which must not only be able to access the Ethereum mainnet, but also be able to access the cross-chain bridge and Rollup. That is to say, it is easy to go from one Rollup to another Rollup, which is such a cross-chain. In such cases, there is no need to wait for a long time.
EIP-3668 This proposal allows ENS and other applications to be migrated to Rollup. This is a general-purpose proposal, and it also allows Layer 1 smart contracts to specify applications or where to obtain state information about the second layer, and can realize the information Verification, that is, verifying Layer2 data through a light client that does not require verification. In addition, you have an ENS domain name that can be registered, and can be updated on the second layer. No matter which second floor he exists in, the user can see this information, and use the same software to see the information in each second floor. Such a prospect is exciting.
The light client allows a node to verify the blockchain, but does not need to run a full client, nor does it need to verify every transaction. Light clients are very important for the decentralization of the blockchain ecosystem. What we are doing now is to upgrade PoS and implement support for light clients, and make the light client system equally powerful on PoS and PoW. And it has an algorithm that enables light clients to verify blocks. This block is signed by the committee, which enables secure clients to access the blockchain without trusting a centralized server. However, the light client system itself also needs to be further expanded so that it can be migrated into the Rollup system. This is very important, we still need to maintain decentralization, and we continue to work hard for this, so that this upgrade is applied to all Layer 2 protocols.
Say the conclusion.
Layer 2 is the future of Ethereum scaling. Using Layer 2 to realize the expansion of Ethereum is the safest solution at present. For the expansion of Ethereum, it is very important to realize the function while maintaining the decentralization of the network, because decentralization is the core of the blockchain.
At present, Rollup compatible with the Ethereum virtual machine has appeared, which can guarantee performance while providing strong scalability. At the same time, it also maintains the current user experience and developer experience. So developing for Rollup is the same as developing for Ethereum, with a few minor changes. For example, the method of block generation and packaging is different, but its virtual machine is the same, and if it is compatible with the virtual machine of Ethereum, it means that all the performance of Ethereum is preserved, and at the same time, the decentralization of Ethereum is maintained. A very important attribute.
At the same time, we still need to continue to work hard to build some infrastructure. Including enriching the ecosystem and finally realizing the expansion path of Ethereum. At present, we already have a clear development roadmap, a large part of which has been implemented or is under development in full swing. I look forward to more exciting achievements in the future, and I am very excited about the current state of the entire Ethereum ecosystem, thank you.
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