Ethereum co-founder Vitalik Buterin spoke at the Devcon 2024 conference in Bangkok, Thailand, where he discussed the development and prospects of the world’s second-largest cryptocurrency by market capitalisation.
Buterin began his speech by noting the regular development of Ethereum since 2015.
He pointed out that if one were to return to 2015, the community would talk a lot about “uncle blocks”—these are side blocks formed by miners but not included in the main network. Today, Ethereum operates on a different consensus algorithm—Proof-of-Stake (PoS)—and discussions primarily focus on second-layer (L2) solutions.
Ethereum is a global computer that is regularly updated and improved, while L2 solutions are like graphics processors, Buterin noted. The first base layer holds everything together and is the reason why second layers can trust each other.
“The first layer is not meant to be super-fast and perform a million transactions per second. L1 is primarily about decentralisation and reliability,” the developer emphasised.
Productivity and Decentralisation of L1 are Crucial
The speed and performance of L1 should also be high, Buterin noted. He cited an example where an L2 solution was compromised. In such a case, users should be able to transfer assets back to the Ethereum base layer, and the blockchain should handle such a load.
The speaker highlighted that after transitioning to PoS, Ethereum became more decentralised. He showed diagrams on the screen of mining pool concentration during the Proof-of-Work era and current validators.
To underscore Ethereum’s high degree of decentralisation, Buterin recalled about five years ago when one client dominated the ecosystem, posing a risk of a single point of failure. Now, he said, the blockchain has many small and unrelated stakers and several clients.
In Buterin’s view, “no other network has come close to Ethereum’s current level of decentralisation.”
He stressed that today anyone can become a staker, run their own node, and support the blockchain’s operation. This does not require high-performance equipment that “resembles a server.” Users can form small pools with friends if they wish.
He also noted the presence of rules in the network that can only be changed through a hard fork.
Light Clients and Lowering the Staking Threshold
As one of the necessary updates, he mentioned the launch of light clients, which do not require downloading the full blockchain history and allow for transaction validity checks. There is a certain risk in this, as if 51% of nodes change the network’s operating rules, the light client will continue to follow them, Buterin noted.
Among other upcoming innovations is lowering the staking entry threshold from the current 32 ETH to make running a node even easier and more accessible. In discussing this, he mentioned the rise in the ether price.
“[32 ETH] is still high, even higher than two weeks ago,” he noted.
Previously, Buterin acknowledged the need to reduce the minimum deposit to 16 or 24 ETH. In the future, the implementation of the Orbit SSF toolkit for solo validators will allow the deposit amount to be reduced to 1 ETH, he added.
The developer recalled the times when Ethereum operated on PoW, and confirming a transaction sometimes required waiting several minutes. In the case of Bitcoin, users still have to wait up to an hour, he noted.
The transition to PoS and the integration of the EIP-1559 update significantly accelerated transaction confirmations, he noted.
Fundamental Changes
Among the priority changes, he mentioned:
- enhancing decentralisation, censorship resistance, quantum resistance;
- improving scalability;
- achieving throughput of over 100,000 transactions per second with L2 solutions;
- developing various applications like social networks and payments.
“We have spent a lot of time on technology, and we will continue to do so. Now is the time to build. Thank you,” Buterin concluded.
Earlier, Buterin published six parts of the essay “The Possible Future of the Ethereum Protocol.”