Where will the Ethereum Virtual Machine (EVM) go in 2023?

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, the original author: Federico Kunze Küllmer, compiled by Odaily translator Katie Ku.

Ethereum pioneered a general-purpose smart contract layer on top of its blockchain, so the Ethereum Virtual Machine (EVM) has attracted and retained a large number of Web3 developers. The EVM is not intrinsically tied to Ethereum, it is already deployed on several other blockchains. Here are three predictions for the development and evolution of the EVM space in the coming year.

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More EVMs will gradually specialize

EVM is currently the most popular execution environment among smart contract developers. The proliferation of Dapps on Ethereum and Layer 2 is a testament to the vibrancy of the build scene.

At the same time, users may be disappointed when they see that many Dapps on these different EVMs are just forks (so-called multi-chain deployments), such as instances of DEXs such as Uniswap or Sushiswap and lending protocols such as Aave.

Rationally, these forks are not meaningless - Uniswap on Polygon usually has lower transaction costs than Uniswap on Ethereum. But multi-chain deployments are less advantageous when considering that liquidity is fragmented across multiple versions of these Dapps, and that developers must maintain the application for each fork.

As the Web3 application space develops (especially DeFi matures), applications will be consolidated into one or a few instances and interoperate with other ecosystems.

Alongside the consolidation, we will also see gradual specialization among the various EVMs to cater for specific types of applications. These are called application-specific EVMs and are designed to meet the needs of application categories such as DeFi, ReFi (regenerative finance), and infrastructure. Some of these applications will mature and migrate to specific application chains (appchains) such as Cosmos.

Decentralized derivatives exchange dYdX is building its appchain within the Cosmos ecosystem, and other Ethereum-native apps may soon follow in order to better control the platform’s entire stack.

So, in addition to broad general-purpose EVMs like Ethereum, Polygon, and Arbitrum, there are plenty of domains for EVMs with unique capabilities to play. Expect more conservative EVMs like Ethereum and others building innovative features to support the next generation of Dapps.

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EVM will prioritize interoperability and composability

This ever-expanding collection of EVMs will be diverse, and the greatest value creation will occur when they are fully composable. It will allow Dapps on one chain to use and interact with Dapps deployed on other chains, effectively creating a cross-chain "currency Lego". In my opinion, this is how Ethereum (mainnet and L2 rollup) and Cosmos will converge in the larger Interchain.

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Ethermint will be the library of choice

Developers will focus on solutions, working on launching the new EVM blockchain. Open source EVM libraries like Ethermint are built for interoperability, a great developer experience, and scalability. (Note: Evmos leads development and maintains the Ethermint library).

The beauty of Ethermint is that it combines the EVM and the Cosmos SDK (Software Development Kit). This means that blockchains built with Ethermint allow EVM smart contracts to use core Cosmos modules.

Having touched upon the importance of interoperability, IBC (the non-custodial cross-chain protocol that made Cosmos famous) is just one of many unique features provided by the Cosmos SDK modules that Ethermint allows Dapps to take advantage of.

Other building blocks such as Interchain accounts and Interchain queries are making cross-chain application development a reality. These two modules allow chains to reply and manipulate messages, as well as control assets on each other's chains.

For example, a cross-chain version of the vault (a Yearn-owned product) family of products like Yearn that can move/trade/LP assets across interconnected chains on Cosmos is the tip of the iceberg for IBC-enabled Dapps.