- The multiplier for L2 rollups exploded to 5x, and on some days in the second half of 2023 to 7x.
- Using EIP-4844, the storage cost of L1 is eliminated.
The Ethereum (ETH) layer 2 (L2) environment has expanded dramatically in 2023. Blockspace demand for scaling solutions has surged, and users are rushing to take advantage of their relative advantages.
How to scale Ethereum in 2023!
According to AMBCrypto’s research on L2Beat statistics, 2023 has indeed been a critical year for scaling solutions built on top of Ethereum’s base layer.
On January 1, 2023, the Ethereum mainnet averaged 13.67 transactions per second (TPS), while the total throughput of the scaling solution was only 4.38.
By December, the story had changed dramatically. The multiplier for L2 rollups has exploded to 5x, and on some days up to 7x. As of December 15, the scaling solution was averaging over 91 TPS compared to Ethereum’s 13.45.
Source: L2Beat
With a growth trajectory like this, there was little reason not to be optimistic about Ethereum L2. But the best part is yet to come.
Ethereum L2 waits for EIP-4844.
The upcoming Cancun-Deneb upgrade (Dencun or EIP-4844) was the most anticipated Ethereum upgrade of 2024. This upgrade, commonly referred to as Proto-Danksharding, aims to reduce rollup costs by 10 to 100 times.
On-chain analyst Leon Waidmann noted the expected reduction in gas fees following the upgrade.
#Ethereum EIP-4844 will be the GAMECHANGER for L2.
Fees for L2 are lowered to CENTS.🔥
After EIP, we’re talking about going from $6.38 to $0.12. @Starknetor as low as $0.03 @arbitrum.
This is the fee cut we’ve been waiting for!
this is the future #ETH,… pic.twitter.com/p9jmNsoDH4
— Leon Weidmann | Onchain Insights🔍 (@LeonWaidmann) January 12, 2024
For networks such as Starknet, Optimism (OP), and Arbitrum (ARB), it has been estimated that token exchange costs on decentralized exchanges (DEXs) will be reduced by up to 90%.
It remains to be seen whether such optimistic forecasts will be realized. The upgrade work was in full swing and the developers were targeting a testnet launch on January 17th.
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As is well known, rollups help reduce fees by batching thousands of transactions into a single transaction and sending it back to Ethereum for verification.
However, the data will eventually be stored on-chain forever and storage costs will be included in the total gas fee.
Read Ethereum (ETH) price prediction for 2023-24
With EIP-4844, data is sent to nodes in the consensus layer and automatically deleted after a certain period of time. During this time, the node verifies the authenticity of the data.
This eliminates the storage cost component and users end up paying much less because the data is not stored permanently.