Cumulative handling fee is more than 2 times that of Bitcoin, indicating that Ethereum is still undervalued? Let's solve the congestion problem

Editor's Note: This article comes fromVernacular Blockchain (ID: hellobtc), Author: A Poplar, reproduced by Odaily with authorization.

Editor's Note: This article comes from

Vernacular Blockchain (ID: hellobtc)

, Author: A Poplar, reproduced by Odaily with authorization.

At the critical moment when DeFi is booming and the price of ETH hits a new yearly high, the Ethereum network transaction fee is also ushering in a surge when it continues to rise for half a year. According to data from Glassnode, the average daily gas cost of Ethereum has continued to rise since May. On July 27, it once exceeded 90Gwei, an increase of nearly 20 times compared to the beginning of the year.

For many DeFi projects and ordinary Ethereum users running on the Ethereum network, the increasingly congested network and increasingly expensive transaction fees have become an "unbearable burden" for the Ethereum ecosystem.

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The congested Ethereum, the "unbearable burden" of users and project parties

Delphi Digital’s latest report shows that over the past two months, transaction fees on the Ethereum chain have surpassed those of Bitcoin — with cumulative transaction fees of $46.7 million for ETH and $25 million for Bitcoin during this period.

This is obviously "attributable" to the vigorous development of the DeFi ecology. The most direct example is the amount of ETH locked in the DeFi ecosystem. As of August 2, the total ETH locked in DeFi has reached 4.311 million, accounting for 99% of the total supply. 3.8%.

Taking the DEX track as an example, the total transaction volume in July has reached 4.2 billion US dollars, while the total transaction volume of DEX last year was only 2.4 billion US dollars. Among them, the star projects Uniswap and Curve Finance are even more crazy. The daily trading volume exceeded the 100 million US dollar mark in July, and the daily trading volume of Curve Finance once exceeded 150 million US dollars. .

The weekly trading volume of the entire DEX track at the end of July has also exceeded 1.5 billion US dollars, setting a record high. The exponentially growing transaction volume on the chain naturally creates a huge demand for network transfers. As the popularity of DeFi projects rises, the corresponding Ethereum network will inevitably appear to be unable to do what it wants.

Mapped to the specific and micro level of use, it is naturally a single payment of a few dollars or even a dozen dollars in gas fees and a long waiting time.

In the past two months, the transaction fee on the Ethereum chain can reach twice that of Bitcoin, which is the most vivid manifestation. The last time that Ethereum was congested due to the surge in demand on the same chain was the 2017 ICO craze.

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ETH2.0, which is far away from the thirsty, needs a new solution

However, it may be slightly different from 2017. Since the beginning of this year, Ethereum’s increasingly congested network and increasingly expensive transaction fees have not caused the community to widely discuss “will lead to the decline of Ethereum” as it did back then. The difference, It lies in the hope and expectation that ETH2.0 gives everyone:

V God specifically tweeted about the current situation of soaring handling fees, saying that the current income structure of Ethereum miners is close to half of the block rewards from transaction fees, which may threaten the security of Ethereum. Proposals such as EIP 1559 could address this issue".

But even if we are getting closer and closer to the launch of ETH2.0 phase 0, even if we may choose to deploy the EIP 1559 proposal in the future, compared with the ever-expanding demand for Ethereum network transactions, it seems that the long-distance water cannot quench the near-thirst.

Therefore, when ETH2.0 has been waiting for a long time, and the performance bottleneck has become an imminent stumbling block, a group of projects began to gradually choose to find another way, turning their attention to the possible solution paths of Layer 2 - Plasma, Sidechain, State Channels, Opitmistic rollups, ZK rollup and Vadium are the current six main technical solutions of Layer-2.

However, unlike Plasma (fragmentation), Sidechain (sidechain), and State Channels (state channel), which are known to everyone in the old Layer2 direction, Rollups technology (Opitmistic rollups, ZK rollup) belongs to the new track that has just sprung up this year. And it quickly became the most promising Ethereum layer-2 expansion solution currently recognized.

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The counterattack of Layer-2, the new dawn brought by Rollup

V God has made it clear many times this year that under the current congestion situation of the Ethereum network, he should devote himself to solving it through the Rollup solution in the short term, and he also personally recommends the Rollup solution to the Tether CTO and other project demanders, "(Rollup solution ) This is the only way in the short term, and there will definitely be ETH2.0 in the long term.”

So what is Rollup? It can be simply understood as a "compressed transaction package" - Rollup packs a large amount of transaction data originally scattered in the block into a "condensed" transaction, then publishes it on the chain, and verifies its security in some form .

According to different forms of verification data security, it can be divided into Opitmistic rollups and ZK rollups. The former uses fraud proof (mechanism design), and the latter uses zero-knowledge proof ZK Rollup (technical guarantee). Currently, these two Rollup technologies are also The most secure Layer-2 path.

Among them, the biggest advantage of Optimistic Rollups lies in its general-purpose computing. Compared with ZK Rollup’s specific application bottlenecks (payments, transactions), almost anything that can be realized in Ethereum can be equally realized on Optimistic Rollups, which naturally includes The composability of DeFi smart contracts is why Synthetix is ​​considering using the Optimistic rollups solution to build its trading platform.

The advantage of ZK rollup, especially favored by God V, lies in its almost absolute security. It introduces zero-knowledge proof technology, so that all calculations can be performed in batches under the chain, and only a small zero-knowledge proof (not a forged proof) needs to be submitted to Ethereum for verification-since Ethereum will verify these proofs, And it stores enough data to accurately determine the status of off-chain accounts, so it has Ethereum-level security.

Loopring, which has been endorsed by V God for many times, is also the only project that is currently used in ZK rollup. Based on ZK rollup technology, Loopring migrates most of the calculations to off-chain, and only broadcasts the new state hash of the transaction and its corresponding proof to the blockchain. On the block chain, under the premise of ensuring the same security as the Ethereum main chain, high-throughput, low-cost transactions are realized:

In the actual measurement, the average cost of each transaction is about 5000 gas, which is 0.0000177 ETH. According to subsequent optimization, the final cost of each transaction is only 0.09 RMB cents (1 million transactions cost about 900 RMB), and the transaction can also be increased in theory. To 3000TPS, far exceeding the current 10TPS of Ethereum, almost on par with VISA's 3000 transactions per second.

More importantly, Rollup is not just a "stopgap measure" that is pulled out before the arrival of ETH2.0. They can also continue to increase throughput on this basis after ETH2.0 is officially launched, and further improve their own performance. availability.