In the early days of Ethereum, the network upgrades were labeled with goofy names like
Tangerine Whistle or Spurious Dragon,
but over the years, as the ecosystem matured,
we moved into more respectable names like the Berlin or London hardforks.
It seems like Vitalik might be feeling some nostalgia for the old days though
because he's returned to his roots with a new roadmap update that consists of five stages---
The Merge,
The Surge,
The Verge,
The Purge
and The Splurge!
Let's get it!
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In this video,
we're going to cover some of the most recent updates from the Ethereum ecosystem.
In the past few weeks,
we have seen some extremely volatile price action across the crypto markets,
but Ethereum has held up surprisingly well compared to many other assets in the space.
In fact, Ethereum dominance rose as high as 22% at the time of recording,
with Bitcoin dominance falling as low as 38%.
ETH has also climbed back to its position before the crash much quicker
than the rest of the market
and is once again trading at around $4,500 at the time of this recording.
It seems that investor sentiment for Ethereum is at an all-time high
despite the negative press about the gas fees.
This is because developers have proven through multiple recent updates
that they are capable of safely upgrading this network.
EIP-1559 was a massive success,
and it has now been an entire year since Ethereum's Beacon Chain was launched,
which began the meticulous transition from proof-of-work to proof-of-stake.
To commemorate the one year anniversary of the Beacon Chain,
Vitalik Buterin posted an updated roadmap for Ethereum,
which showed a series of steps that he believes will help the network scale for mass adoption.
As usual, Vitalik has come up with some creative names for this process---
The Merge,
The Surge,
The Verge,
The Purge
and The Splurge.
I can say that a million times
and still think it's funny.
Ethereum's base layer infrastructure will start the next phase of its upgrade
with an event called The Merge.
This is when the Ethereum proof-of-work mainnet will merge
with the Beacon Chain proof-of-stake network.
The Surge represents the huge improvements in scaling
that sharding will bring to both the Ethereum mainnet
and its layer 2 rollups.
This has nothing to do with a drink that tastes like caffeinated Mountain Dew.
Well, more caffeinated anyways.
Remember,
these scaling solutions will work in tandem to provide maximum scaling capabilities.
There were some misunderstandings over the past year
that sharding will make second layer rollups obsolete,
but this is not the way things will play out.
These scaling solutions will actually complement one another.
They're very nice.
This is the modular blockchain approach to scaling that Etherians are starting to get excited about
because it allows the network to achieve low fees and high transaction times
while maintaining its security and decentralization.
The modular blockchain thesis is the idea that a decentralized web of layer 2 networks
will serve different communities and use cases
while tapping into the security of Ethereum's base layer through rollups.
Eventually, all user activity will be taking place on various layer 2s,
with developers and applications settling transactions actually on layer 1.
Next up is The Verge.
No, not that one.
The one that will bring complex upgrades to cryptography on the Ethereum network
by replacing Merkle trees with something called Verkle trees,
a new advancement in cryptography that was just developed in 2018.
Most of the details here are only relevant to programmers,
but just know that this section of the roadmap
is focused on beefing up the cryptography on the network.
After that comes The Purge,
where certain historical data will be removed from Ethereum's base layer
and move to the application layer to allow for further scaling.
This is another highly technical area,
so I'll move on to the final step.
The Splurge!
This vital step is basically a grab bag of some of the most important upgrade suggestions
from developers that didn't fit in any of the other categories.
Most of these involve improvements to features that already exist or problems
that the community is already working on,
such as preventing harmful MEVs like frontrunning.
This section also includes long-term goals like quantum resistance and zK-SNARK cryptography.
Vitalik also published another improvement proposal for Ethereum this week,
EIP-4488,
which would lower fees on Ethereum second layer even more
by reducing the calldata cost from 16 to 3 gas per byte.
This means that it will cost less gas for the layer 2 networks
to interact with Ethereum's base layer,
which will result in a drastic decrease in fees for users.
Currently, on networks like Optimism and Arbitrum,
fees are as high as $5 at times,
which is still better than layer 1,
but still not where we want to be.
This calldata cost is one of the main reasons
that these layer 2 networks have been forced to charge such high gas fees.
But with this new EIP,
fees will be lower than we see on centralized exchanges.
Vitalik expects that this could reduce fees on layer 2 by as much as five times.
This will make the blockchain slightly larger
but will not have any significant impact on decentralization
as users will still be able to run a full node with a home computer.
Outside of the infrastructure developments,
there's also been a ton of news with applications on Ethereum in recent weeks as well.
Lyra Finance, a layer 2 exchange for trading options,
announced that they will be launching a retroactive airdrop for early participants in the community.
Early traders and liquidity providers will be rewarded with free tokens.
But an investment wasn't necessarily required for this airdrop.
Some users who joined Lyra's Discord server and participated in a few conversations there
will also be rewarded with tokens.
And they didn't even have to spend any money.
Getting paid for talking?
What a novel idea!
This is a trend that we've been seeing a lot recently.
Teams are not just using on-chain transactions to decide who gets airdrops
because this gives a bit too much power to the whales
who have plenty of money to move around.
Now, teams are looking for new and creative ways to reward users
who support projects without spending their money.
Discord is really becoming the hot place to be for the crypto community.
It is a great place to have direct conversations with developers,
and now people are getting free money just for being a part of the discussion.
Speaking of airdrops,
OpenSea faced a massive backlash from the NFT community this week
after several news sources speculated that they could be going public with an IPO
instead of launching a token and airdropping it to frequent users.
The news broke after it was announced that Brian Roberts, the former CFO of Lyft,
quit his job at the ridesharing company to join OpenSea.
Roberts was the person who facilitated Lyft's move to go public,
so it was assumed that OpenSea had hired him for the same purpose.
NFT collectors were outraged by the news
because they saw it as a betrayal of crypto values,
and they were expecting a hefty airdrop,
considering all those fees that OpenSea has collected from them over the past year.
The backlash was so intense
that Roberts was forced to make a post denying that OpenSea was planning an IPO.
In his post,
he called the news reports about the IPO inaccurate
and promised that OpenSea would include the community somehow
if they ever did decide to go public.
Taking a look at the comments on his post,
it doesn't really seem like anyone is buying the story.
Most of the top comments are suggesting that OpenSea is backpedaling,
playing damage control after flying too close to the sun.
It doesn't really help his case that there is a direct quote in Bloomberg
where he says that OpenSea would be foolish to not think about going public.
I bet he wished he had kept that private.
OpenSea has also had a terrible reputation with its users
after multiple scandals ranging from censorship to insider trading.
At this point,
the only thing they can do to regain credibility with the community
is to launch a token with a massive airdrop
similar to what we saw with ENS domains a few weeks ago.
Interest in ENS over the past few weeks has exploded.
This isn't people who are trying to farm an airdrop.
These are new users who got caught up in the excitement from the token
and want an ETH domain of their own.
November has been the best month ever for ENS,
with over $7.3 million in revenue that will go directly into the newly formed DAO treasury.
Developers are also getting excited about ENS
and have begun working on mainstream use cases for ENS domains.
Remember, these domains are stored as NFTs that exist in your Ethereum wallet,
so they can be used as a personal identifier that can allow you to log in to online accounts
or even unlock your car or home.
Japanese developer Hideyoshi Moriya posted two different videos to his Twitter profile
where he unlocked his car and home using an app on his phone and his ENS domain.
Cool trick, Mr. Moriya,
but next time, use a Lambo.
That's all I got.
Be blessed.
BitBoy out.