This article comes from Cointelgraph, original author: Nebojsa Urosevic
Odaily Planet Daily Translator | Moni
For the crypto industry, the Ethereum scaling problem seemed obvious from the beginning, especially as the use cases continued to increase and the existing technology could not handle the large number of transactions, it was imperative to implement innovative solutions to expand the network.
If all goes well, the Ethereum Dencun upgrade will take place on March 13. While this is an important step in the right direction, some community members believe that Dencun is just a short-term patch and Ethereum needs a sustainable long-term solution.
Is Dencun a temporary solution?
The Dencun upgrade, which aims to enhance Ethereum’s scalability, is currently being deployed on testnets. While the Goerli testnet upgrade was previously delayed due to a bug, the deployment on Sepolia and Holesky is going quite smoothly.
Dencun introduces the concept of "proto-danksharding", which aims to reduce transaction costs by using the "blob" format instead of "calldata". Blob will make transaction data temporarily available in a "compressed" format, which will significantly improve storage efficiency and be more cost-effective than calldata (it is said that it is possible to reduce costs by 80% to 90%). Subsequent sharding upgrades will also use the same format. Overall, the Dencun upgrade will bring higher storage efficiency, lower gas fees, and a better experience to developers, while making Rollups more cost-effective.
Bitwise Invest researcher Juan Leon analyzed that IP-4844 will enable "data fingerprints" that compress transaction data structures and reduce L2 transaction fees to less than $0.01, which will greatly promote the expansion of the Ethereum network and pave the way for mainstream consumer applications (transaction costs become negligible, which is a major obstacle). FalconX research director David Lawant expressed a similar view, adding that "technological developments generally do not affect the price of cryptocurrencies, but ETH upgrades are an exception. Before key upgrades, ETH tends to outperform BTC."
While the Dencun upgrade is a step in the right direction, it is not a permanent solution. The focus of this upgrade is to make data storage more efficient, which is undoubtedly beneficial. However, the long-term problem facing the Ethereum network is capacity, and future development must focus on expanding the network capacity to support the increasing number of transactions being executed. From this perspective, a multi-chain solution may be more likely to achieve this goal.
The Way Forward: Rollups and AppChains
Multi-chain solutions, namely Rollups and AppChains, are the ideal long-term mechanism for increasing Ethereum's capacity.
Lisk, also known as application-specific blockchains, have their own dedicated processing power and storage designed to serve a single application. Lisk can be built on top of a larger mainnet, such as Ethereum, or even an L2 blockchain, which allows on-chain transactions to be offloaded from the mainnet and processed by the Lisk. If widely used, Lisk will greatly increase the capacity of Ethereum.
Rollup technology can be used to build application chains, but the difference is that Rollup mainly handles off-chain transactions - transactions are executed off-chain, then "aggregated" into a single transaction and fed back to the main network. Rollups are generally less efficient than application chains because they are usually more dependent on the main chain for security than application chains. In addition, they are less customizable than application chains, but they can still provide some flexibility and are easier to deploy and manage.
Since both have their own advantages, combining the transaction efficiency of Rollup with the flexibility and customization of application chains can achieve synergy. Developers can also benefit from expanding beyond the L1 network to a more scalable and versatile environment, making it easier to design and deploy blockchain applications that meet the needs of the user base while maintaining a high level of efficiency and security.
By increasing capacity, throughput, reducing latency, and improving resource management, multi-chain solutions enable the network to accommodate larger transaction volumes while maintaining optimal performance.
In addition to Dencun, how to deal with the blockchain triangle dilemma?
Developers have been working hard to solve the blockchain trinity problem, trying to find a balance between scalability, security and decentralization. Multi-chain solutions that emphasize interoperability and security have the potential to help Ethereum realize its full potential.
Frankly speaking, implementing multi-chain solutions on the Ethereum network also brings a set of unique challenges to developers. One of the main obstacles to multi-chain solutions at present is that the interoperability management between different chains is too complicated, so the integration of cross-chain communication protocols and integrated technologies, as well as ensuring consistent security measures across multiple chains are urgent. In addition, to overcome these challenges, it is necessary to have a comprehensive understanding of the technologies involved and to work on creating an accessible and developer-friendly environment to promote the seamless integration and effective use of multi-chain solutions.
The future development of Ethereum is exciting, and finance, identity, gaming, supply chain, healthcare, food supply, and many other industries have begun to benefit from the Ethereum network, but rapid growth also comes with growing pains.
Capacity is a growing concern for Ethereum. While the Dencun upgrade will help address this by improving efficiency, it is more of a band-aid at this stage. So in the long run, the best way forward is still to increase capacity, and multi-chain solutions such as application chains and Rollups may be a good idea.
