Inspiration from EthCC: The truth about Ethereum’s Rollup-centric roadmap

Author: Christine Kim, Grayscale; Wuzhu, Golden Finance

Christine Kim of Galaxy Research attended the 7th Ethereum Community Conference (EthCC), which was held for the first time in Brussels, Belgium. This year’s conference was rescheduled to avoid a conflict with the 2024 Summer Olympics in Paris, France. Ethereum France President Jerome de Tychey announced on the last day of EthCC that the conference would not return to Paris next year. The 8th Ethereum Community Conference (EthCC[8]) will be held in a brand new location in Cannes, France in 2025.

In this article, Christine shares her key takeaways and learnings from EthCC.

Image Caption: EthCC conference venue in Brussels, Belgium. Photo credit: Christine Kim

Analyzing the impact of a Rollup-centric future

During EthCC this year, I gained an important insight into Ethereum protocol development. The rollup-centric development roadmap means that changes to the Ethereum protocol will have less and less impact on end users over time. This is a fairly obvious and in many ways positive conclusion for the ecosystem, but it also implies some lesser-known and potentially hard-to-decipher truths that are worth uncovering.

• As Ethereum protocol developers focus more on optimizing for data availability (DA), the rest of the Ethereum ecosystem will focus less on protocol development. Ethereum will become less relevant to users as an execution layer, as users migrate to rollups as the primary touchpoint for value transfer and interaction with decentralized applications (dapps). The responsibility for improving the user experience, then, will fall primarily on rollup development teams as it relates to transaction speed, ordering, and confirmations. As a result, the upgrades that matter most to users will happen on rollups, not Ethereum. On Ethereum, protocol developers will prioritize improving the protocol as the DA layer. In fact, as shown by the code changes included in the Dencun and Pectra upgrades, they have already done so.

• As protocol developers focus more on optimizing for data availability (DA), the technology needed to achieve breakthroughs in Ethereum’s UX will be built primarily by rollup teams rather than client teams.All of the buzzwords that have caught the attention of EthCC investors and builders, such as Maximum Extractable Value (MEV), Trusted Execution Environments (TEEs), account abstraction, intent, and pre-confirmations, are becoming less relevant to Ethereum as a DA layer and more relevant to rollups as execution environments for the next wave of major crypto adopters.Innovative solutions and cutting-edge technologies being researched to solve the thorniest problems of crypto UX will increasingly be spearheaded by core development teams outside of Ethereum. This will also lead to more and more protocol developers and client teams working for rollups to continue advancing Ethereum’s mission, even as the Ethereum protocol shrinks in use cases and functionality. Already high-profile Ethereum core developers like Ben Edgington and “Protolambda” and client teams like Prysmatic Labs have come to this conclusion and now work full-time for rollup teams.

• As protocol developers focus more and more on optimizing for data availability (DA), they will have less and less visibility into and control over the values ​​and ethos that drive Ethereum product and application development.For much of Ethereum’s history, code changes activated via hard forks had a direct impact on user behavior. Protocol developers adjusted the prices of certain opcodes, introduced new precompiles, and removed features like gas refunds. While many rollups are very careful to mimic the execution environment of Ethereum today, their maturity will lead to greater deviations as Ethereum reinvents itself as a DA layer. Due to competition and the changing regulatory environment, there is no guarantee that the values ​​that guided Ethereum’s design choices as an emerging general-purpose blockchain will affect rollups to the same extent. As Ethereum’s user base migrates to rollups, protocol developers must consider the fact that they will have less control over how to influence and correct on-chain user behavior through protocol changes.

Image Caption: Ethereum co-founder Vitalik Buterin delivers a keynote speech at EthCC. Image credit: Christine Kim

The Importance of Ethereum Upgrades is Diminishing

As protocol developers pursue rollup-centric roadmaps more and more seriously, the importance of protocol changes on Ethereum will gradually diminish.In many ways, the pros and cons of minimizing Ethereum’s role in the ecosystem are similar to those of minimizing the Ethereum Foundation’s role in the ecosystem. The mentality of reducing the role of a protocol to help expand its reach is risky, but also necessary for decentralization. This is the vision for Ethereum, and it was most clearly explained by Aya Miyaguchi, Executive Director of the Ethereum Foundation, when she explained her vision for the Ethereum Foundation.

She said: “The best part about Ethereum is that it is decentralized, and because of that, the ecosystem faces unique challenges. I see subtraction as a strategy to achieve two main goals.…The first goal is that we have to find the right balance. Building an Ethereum empire and solving all the problems ourselves might make us look good in the short term, but it makes others [feel] that this ecosystem is something that anyone can build on, and Ethereum will also become a single point of failure. If we continue to add, the ecosystem will always be dependent on Ethereum.”

At EthCC, there were a large number of side events, which is nothing new during Europe’s largest Ethereum conference. However, this year, more than in previous years, the side events became the main event, showcasing new ideas, experimental technologies, and important discussions that are most relevant to Ethereum users. While protocol developers were well represented at EthCC, and the topic of Ethereum as a protocol was the headline of the EthCC agenda, it was not the focus of the conference week for many attendees. That’s because the building blocks of the future of finance are being built elsewhere. They are being built outside of the protocol. Therefore, even though Ethereum protocol developers may make bold and ambitious code changes to the core protocol, their relevance to the ecosystem will diminish over time. It is time for the impact of innovative solutions and new technologies built on top of rollups to overshadow the relevance of Ethereum upgrades.