Galaxy Research Big Take On Quest To Hike Ethereum Gas Limit

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As a seasoned researcher with a decade of experience in blockchain technology and Ethereum specifically, I find myself at a crossroads when it comes to the question of increasing the Ethereum gas limit. On one hand, data-driven arguments such as those presented by Marek Moraczyński suggest that an increase is both justified and safe for the protocol. However, my own analysis leads me to question if now is truly the right time for such a move.

As a researcher at Galaxy Research, part of Galaxy Digital Holdings, I have been actively engaging in discussions surrounding the potential increase of the Ethereum gas limit. Since the early months of this year, developers have suggested that this change could be beneficial for the mainnet. Notably, even co-founder Vitalik Buterin has expressed support for a 33% gas limit increase. However, at Galaxy Digital, we believe there are several other factors to take into account before making such a move.

Ethereum Gas Limit: Is The Time Right?

According to Christine Kim’s discussion at the recent Ethereum developers’ conference, Marek Moraczyński from Nethermind presented evidence that supports and considers it safe for the protocol to increase its parameters.

In comment, Kim highlighted there are factors that need analyzing on why this proposal is worth considering. First, the block gas limit will not impact the blockchain. Several researches have pointed at this, invalidating claims that increment above 25% might overload the network.

In summary: There’s enough evidence to indicate that expanding the gas limit on Ethereum won’t cause harm. However, considering Ethereum’s scaling strategy, it seems unlikely to bring benefits in terms of transaction fees, activity, or overall network worth. Therefore, what is the point of advocating for it?

— Christine Kim (@christine_dkim) December 6, 2024

Conversely, Christine Kim expressed her viewpoint as “there’s a good chance it won’t have a tangible positive impact on Ethereum.

Given the wide degree of ambiguity, the researcher pointed out that at this moment, the key validators are not prepared to support the proposed idea. Specifically mentioning Coinbase and Kraken Exchanges, she expressed concerns about potential setbacks stemming from the speculations surrounding an increase in Ethereum block gas limit.

Boosting the gas limit significantly could greatly enhance the scalability of the Ethereum protocol. Should the current discussions regarding raising the limit be successful, the developers intend to introduce EIPs (Ethereum Improvement Proposals) as part of the Pectra Update to carry out this change.

Galaxy Research implied that it might not be the right moment for implementing Ethereum gas limits as a short-term solution to scalability issues.

Growing Layer 1 Competition

For the last twelve months, various Layer 1 blockchain systems have been suggesting potential updates to their platforms. Notably, Vitalik Buterin has consistently led discussions about enhancing Ethereum’s scalability over the next ten years.

Although Ethereum is currently leading the pack with its powerful layer-2 scaling technologies, other blockchain networks are also making their presence felt and growing stronger.

It’s been reported that the Cardano Hydra protocol recently achieved a significant milestone of processing one million transactions per second in test conditions. If these results were applied in real-world scenarios, the protocol would undoubtedly become the quickest in the industry, setting it apart as an effective scaling solution for Cardano.

Besides Solana, the SUI Network, and the XRP Ledger, each possess unique advantages as they navigate increasing rivalry within the industry.

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2024-12-07 02:30