Ethereum Scaling Prevails In Heightened Market Volatility
Ethereum, the world's second-largest blockchain, is making waves with its impressive scalability, especially during times of market unpredictability. According to Leon Weidmann, head of research at Onchain Foundation, Ethereum's scaling progress is "unstoppable," which is a bold statement given the current market volatility.
Understanding Ethereum's Layer 2 Solutions
Ethereum's scaling success is largely attributed to its Layer 2 solutions, particularly rollups. But what exactly are rollups? Imagine you have multiple packages that need to be shipped; instead of sending each one separately, you combine them into a single large package to save on shipping costs. Similarly, rollups gather several transactions, process them off the Ethereum mainnet, and then return them as a single transaction. This method dramatically improves Ethereum's transactions per second (TPS).
Currently, rollups are processing around 300 transactions per second, which is about 24.93 times more than the Ethereum main chain alone. This significant increase in TPS showcases Ethereum's ability to deliver real technological results despite economic uncertainties.
The Impact of the Xai Network
June was a landmark month for Ethereum's scaling network, reaching an all-time high of 246.18 TPS. This surge was primarily driven by the Xai network, a new Layer 3 scaling solution focusing on gaming applications. Remarkably, over 41% of the transactions during this period were attributed to the Xai network.
Despite these advances, the Total Value Locked (TVL) in Xai remains relatively small compared to other networks like Arbitrum One.
Younger ETH Layer 2s Surpass Older Ones
Leon Weidmann has observed a notable trend: newer Layer 2 solutions are quickly outpacing older ones. For example, the Base network, backed by Coinbase and only a year old, has over 2.64 million weekly active users. In contrast, Arbitrum One, which has been around for three years, has fewer active users at 1.37 million.
Other new networks like Linea and ZkSync Era are also gaining traction, each attracting hundreds of thousands of active users in a short time. "The future of ETH scaling is here, and it’s evolving much faster than the market currently realizes," Weidmann concludes.
These developments prove that Ethereum's scaling solutions are not only effective but also vital in navigating the complexities of the cryptocurrency market.
