Posted 6 months ago | by Catoshi Nakamoto
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 has 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.Read More
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 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 four thousand five hundred dollars.
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.
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. Remember these scaling solutions will work in tandem to provide maximum scaling capabilities. There were some misunderstandings over the past year that that sharding will make second layer rollups obsolete, but this is not how things will play out, these scaling solutions will actually complement one another. 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 roll ups. Eventually, all user activity will be taking place on various layer 2s, with developers and applications settling transactions 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 moved to the application layer to allow for further scaling. This is another highly technical area, so I will move on to the final step… THE SPLURGE.
This final 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 MEV 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’s 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 five dollars 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 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 has 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 would 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.
This is a trend that we have 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 and 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. 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, and 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 as well, 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 into 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.