Vitalki Buterin spoke at the Shanghai International Blockchain Week 2021. He suggested Layer 2 is the way forward for Ethereum scaling. This layer allows the network to be safely scaled while maintaining decentralization.

Buterin said that Eth 2.0 will soon launch its initial phases, with the Eth 2.0 roadmap offering scalability. The last phase of Eth 2.0 will be base layer scaling for applications, and could take years.

Ethereum scaling is more than an idea. It’s a roadmap that many parts of have been created, released, or are in the process.

Behind the scenes efforts to make Ethereum more secure and scalable have been underway, with the Eth2 upgrade being implemented gradually.

The first Eth 2.0 upgrade, “Beacon Chain upgrade,” was implemented in December. It introduced staking to the Ethereum ecosystem, and the Ethereum mainnet’s merge with the Beacon Chain’s proof-of-stake system will signal the end of proof-of-work consensus. In 2022, the Merge is expected to occur.

After the Merge, “sharding” is next on the development plan. It is a multi-phase upgrade to improve Ethereum’s scalability and capacity through the use of shard chains to spread the network’s load across 64 new chains.

Going further, Buterin admitted that the need to make Ethereum more scalable is a top priority, but Ethereum’s native scaling (sharding) would take a long time. Therefore, “Rollups,” a Layer 2 solution that handles transactions outside the main Ethereum chain (layer 1) but posts the transaction data on layer 1 was launched to cause a significant increase in scalability up to a factor of 100.

Polygon Hermez has launched Layer 2 solutions such as Loopring, ZKSync and Optimism. Buterin stated that the current cost for ETH transfer on Polygon Hermez costs $0.25, while it is $6.84 on Ethereum.

Buterin stated that Ethereum embraces rollups in its scaling strategy. In the immediate and mid-term, however, it is likely that optimistic rollups will be more popular than less ambitious rollups. ZK rollups were preferred in the long term, but they are far more difficult and secure.

ZK rollups are faster than optimist rollups. They run calculations off-chain and send a validation proof to the chain. Withdrawals can take around a week.

Buterin stressed that rollups are still difficult to implement despite technological advances and new applications.

Buterin said that rollups could be used by non-financial users to reduce the fees, as they were becoming more irritated at high fees.

Rollups could also benefit NFTs and Ethereum Name Service (ENS), as well as light clients, decentralized autonomous organisations (DAOs), and NFTs.

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