Vitalik Buterin Identifies Ethereum’s Primary Challenge

Ethereum co-founder Vitalik Buterin has identified the lack of a unified ecosystem as the network’s most pressing issue. He made this statement at the Shanghai Blockchain Week 2024, according to Colin Wu.

Vitalik said at the 2024 Shanghai Blockchain Week that the main problem of Ethereum now is the lack of a unified ecosystem. Ethereum is now like 34 different chains. Ethereum’s future goals include achieving more than 100,000 TPS through L2, completing transfers from any chain to…

— Wu Blockchain (@WuBlockchain) October 17, 2024

The current protocol-based space resembles 34 different blockchains, the programmer noted.

As long-term development goals for Ethereum, he mentioned:

• achieving throughput of over 100,000 TPS through layer 2 solutions;
• completing transactions between any chains within two seconds;
• a unified interface.

Buterin also mentioned tasks of improving the EVM and enhancing link security.

In a previously published essay on the blockchain’s “potential future,” he emphasized the importance of supporting solo staking to accelerate transaction processing and ensure network security.

Meanwhile, Ethereum stakers’ total revenue has declined due to decreased network activity, analysts at The Block noted. In September, the figure was $174 million compared to a peak of $247 million in March—a drop of approximately 30%.

Transaction fee volume in the first month of autumn was $35.5 million, whereas in March it reached $62.4 million.

At the same time, the number of validators continues to grow, reaching 1.09 million.

The deflationary mechanism of burning part of Ethereum’s fees is functioning, but signs of a reversal are evident, experts noted. Following The Merge hard fork, the annual rate of coin supply reduction was at -0.06%, which meant the removal of 861,000 ETH from circulation.

The highest burn rate was recorded on April 5 at -0.38%, and it has been steadily declining since.

Implementation of EIP-4844 during the March hard fork Dencun significantly reduced fees for L2 solutions, especially on Rollups technology. This led to a decrease in gas consumption on the network.

In September, a community member under the pseudonym Cygaar proposed a solution to restore the ETH burn rate. Not everyone agreed with his idea.