$ETH: Coinbase on Why It Is Excited About the Surge and Why It Supports EIP-4844admin
Last week, Coinbase explained why it was excited about the Surge, which is the next major milestone in Ethereum’s development roadmap.
On July 21, Russian-Canadian programmer Vitalik Buterin, who is the creator of Ethereum, shared his thoughts about “the longer-term future of the Ethereum protocol” at the annual Ethereum Community Conference (EthCC) in Paris, France.
Buterin started his talk by saying:
“The Etheruem protocol right now is in the middle of this long and complicated transition, and it’s a transition toward becoming a system, which is much more powerful and robust in a lot of ways, right?
“At the end of the last year, I published this kind of updated roadmap document, where I talked about these big five categories of stuff that’s happening in Ethereum protocol land, where there’s the merge, the surge, the verge, and then a bit lower is going to be the purge and the splurge, right?
“The Merge is proof of stake. The Surge is sharding, and The Verge is Verkle Trees, The Purge is things like state expiry and deleting old history, and The Splurge is basically just all of the other fun stuff.”
The next day, crypto investor and analyst Miles Deutsche took to Twitter to explain further what each of these five stages in the Ethereum roadmap mean.
Here is what Deutscher had to say about the five stages mentioned by Buterin during his talk:
- The Merge: “Now becomes a deflationary asset (reduced issuance). Cuts power usage by 99%. The date of this upgrade is currently September 19th, 2022.“
- The Surge: “This will significantly increase the network’s scalability.“
- The Verge: “This will optimise storage on Ethereum and help reduce node size. Ultimately, this assists $ETH in becoming more scalable.“
- The Purge: “Reduces the hard drive space needed for validators. This eliminates historical data and bad debt. Streamlines storage, which in turn reduces network congestion.“
- The Splurge: “A series of miscellaneous smaller upgrades which ensure the network runs smoothly following the prior 4 stages.“
Around 7:00 a.m. UTC on September 15, Ethereum’s Merge upgrade was completed, which means that the Ethereum network is now using proof-of-stake (PoS) consensus instead of the much more energy-hungry proof-of-work (PoW) consensus.
In an interview for the Bankless podcast that was released on 26 September 2022, according to a report by The Daily Hodl, Vitalik had this to say about Ethereum’s two main priorities:
“I think there are two big priorities. One of the priorities is to get scaling figured out. And I mean that at all layers of the ecosystem, like getting the Ethereum protocol fully roll-up ready, which includes things like prototank sharding, getting roll-ups themselves to be fully ready for users, getting applications on top of them, getting good bridge infrastructure between them, getting all the wallets to support them… Not just helping the transition to a fully roll-up-centric Ethereum complete.
“Then, the other one is a transition from Ethereum being in rapid developing fire fighting mode to Ethereum being in stability mode. I think it’s a transition that has to happen and I do think that to some extent it’s an inevitable transition because as the ecosystem grows, the cost of changing things increases, and then there starts being all these regulatory concerns and lots of existing stakeholders…“
In a blog post published on 6 October 2022, Jesse Pollak, Senior Director of Engineering at Coinbase, had this to say about the Surge and EIP-4844:
“At Coinbase, we are excited about the Surge because we believe that reduced onchain transaction fees and increased throughput will have a positive impact on the rate of adoption of the cryptoeconomy and help build the bridge to web3. As a reminder, when users interact with a blockchain like Ethereum, they pay ‘gas fees’ to the Ethereum network for the computational cost of the onchain activity.
“Even with Ethereum gas fees near recent lows, fees are still too high ($1-10 per transaction). And as we saw last year, when crypto usage surges, these fees can increase by multiple orders of magnitude ($10-100 per transaction), making onchain activity inaccessible for users. Our priority is to bring our over 100 million existing customers and the rest of the world into the cryptoeconomy, and we must make it cheap and easy for them to use crypto at scale.
“Enter EIP-4844: an upgrade to the Ethereum network that will reduce the cost of layer 2 rollups by 10-100x and shepherd in a new era of low cost onchain activity. EIP-4844 works by introducing a new transaction type to Ethereum that accepts ephemeral ‘blobs’ of data. This new blob data storage is purpose built for storing rollup data and enables us to create a new, lower cost fee market.
“With this change in place, we expect fees on layer 2 rollups to decrease by 10-100x. The upgrade also takes us one step closer to full sharding (another 10-100x cost reduction!) and ensures that the new data storage requirements are manageable for stakers.“
He went on to say:
“In May of this year, we got together with OP Labs (the core development team behind Optimism) and the Ethereum Foundation and began collaborating to specify, implement, and test EIP-4844. As part of this collaboration, we’ve dedicated significant engineering resources to the effort because we believe it will have an outsized positive impact on both our business and the broader ecosystem.
“Thanks to the hard work of these teams and others, we now have a full specification for the execution and consensus clients, working implementations in the Prysm and Geth clients, nearly complete preparations for the KZG ceremony, and a launched Devnet v1. Over the next few months, we expect to further harden the specs, expand implementation work to additional clients, and launch a fully functioning testnet.“