At a Hong Kong conference, Ethereum (ETH) co-founder Vitalik Buterin discussed the future of Ethereum and why ETH 2.0 is taking so long to launch.
Ethereum (ETH), the second largest cryptocurrency by market capitalization, has seen massive growth of over 1000% over the past year.
The blockchain project has flourished with the vast majority of decentralized finance (DeFi) protocols and stablecoins built on top of it. Currently, the total value locked in DeFi protocols is now over $ 60 billion. However, as it struggles to keep up with demand, its flaws regarding scalability and high transaction fees become more obvious.
On the contrary, according to Vitalik Buterin, Ethereum has no technical problems:
"One of the biggest problems I have encountered with our project is not technical problems, it is people-related problems."
He added that:
“Ethereum is now in a better economic position, but it took us five years to get to where we are now. We have many internal team conflicts in these five years. If you are building a team, it is important to know who you are working with. "
Regarding the build process, Buterin said that Ethereum took longer than he expected:
“At first, I thought we could do a blockchain in three months… but we found that it takes 18 months to finish. We thought it would take a year to do the proof of stake, but it actually takes six years.
If you are doing something complex that you think will take a while, it will actually most likely take a lot longer. It is something that many people will tell you, but if you have not done a project yourself, you may not believe it, but it is real ”.
About the next update in the Ethereum ecosystem
These days, the most interesting and trendy stories about Ethereum since Phase 0, also known as the Beacon Chain launched in December 2020, are those related to the upgrade to Ethereum 2.0.
On why the update is called Ethereum 2.0, Buterin said:
“Actually, we call it Ethereum 2.0 a little less because we want to emphasize that this is not ditching the existing Ethereum platform and making a totally new one. It's a much more incremental type of change. "
The long-awaited update involves Ethereum's transition from the power-consuming Proof-of-Work (PoW) consensus algorithm to the energy-efficient protocol, Proof-of-Stake (PoS).
The scalability of the network is expected to be improved through stability characteristics such as fragmentation and stacks. According to the Ethereum co-founder, fragmentation and stacks will independently increase the scalability of the network by a factor of relatively 50 to 100.
Buterin added that:
“The two are stacked on top of each other, so once you have accumulations and fragmentation, Ethereum and the things on top of Ethereum will be able to have the kind of scalability that large-scale enterprise applications expect.
There are many other things that people are building in the Ethereum space, but the blockchain's ability to handle all transactions is having a hard time keeping up with demand, which is exactly why we are working on all of them. these things. the technological side with scalability and proof of stake are very important ”.
Are other blockchains really challenging to Ethereum?
Due to Ethereum's volatility issues and high transaction fees, various blockchains such as Binance Smart Chain, Cardano, Polkadot, and Solana are coming up to unseat Ethereum.
In this regard, Vitalik Buterin said:
"Many of the newer chains are trying to aim for more scalability anyway and sacrifice decentralization."
He added that:
"In the long term, the challenge for these types of platforms is that Ethereum itself is improving, and there are also these layer two protocols on top of Ethereum that are improving rapidly."