Chainfeeds Introduction:
Inspired by the Bankless podcast, IOSG Ventures researcher Jiawei rethought the rationality of Ethereum's Rollup-centric roadmap, the hidden trade-offs behind it, the current status and expectations of L2, and how to better value Ethereum.
Source:
https://x.com/0xjiawei/status/1833088504664055820
Article author:
Jiawei
Viewpoint:
Jiawei: 1. The rationality of the Rollup-centric roadmap: Vitalik published the "Rollup-centric Ethereum Roadmap" in October 2020, proposing that Ethereum needs to centrally support Rollup in the short and medium term. Subsequently, "Endgame", published in December 2021, described the final picture of Ethereum: block output is centralized, but block verification is trustless and highly decentralized, while ensuring anti-censorship. These two articles basically determined the direction of Ethereum's development: optimizing Ethereum's base layer construction to serve Rollup. These Rollups can obtain Ethereum-equivalent security and help Ethereum achieve super expansion. The above argument may be based on the view that since Rollup has been proven to be effective and well adopted, "instead of spending several years waiting for an uncertain and complex expansion plan (referring to the original sharding), it is better to focus on Rollup-based solutions." 2. The trade-offs hidden behind rationality: L1 delegates execution to L2, which actually implies two trade-offs: - Gas collection and the deflationary relationship between Gas and ETH. First, transactions occurring in Rollup mean that gas fees are collected by Rollup rather than Ethereum L1. Second, gas is actually linked to ETH deflation. After the London upgrade, EIP-1559 introduced a burning mechanism, and the base fee of each transaction will be burned. After "The Merge" switched to PoS, Ethereum actually entered a 20-month deflationary cycle due to the significant reduction in ETH issuance and the existence of the burning mechanism. If more transactions occur in Rollup in the future, Ethereum may return to inflation. - MEV value capture. Transactions occurring in Rollup mean that MEV is captured by Rollup, not Ethereum validators. After EIP-4844, DA fees were further reduced. 3. Is the current status of L2 consistent with expectations? I don't think it is completely consistent with the original. Technically, each Rollup might be considered a "computing shard" of Ethereum. But in reality, each L2 seems to have a series of problems that need to be solved, such as interoperability issues. There are too many L2s today, and there are many hills. Although ETH is used as the main unit of account, this use case may be replaced by the L2 native token later. More Rollups turning to Alt-DA solutions may also weaken the profitability of L1. In short, today's L2 is not working in one direction, but has a very fierce competitive landscape. 4. How should Ethereum be valued? Ethereum has its completeness, and we tend to think of Ethereum from the perspective of the company. The question we need to think about in the future is: How to better value Ethereum? In the next few years, or even ten years later, should Ethereum be valued and priced from the perspective of the execution layer or the security layer?
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