As user engagement surges, the need for enhanced scalability and reduced transaction expenses in Ethereum's Layer 2 solutions becomes increasingly critical.
Role of Layer 2 Solutions for Ethereum
Layer 2 solutions are built on top of Layer 1 networks and are designed to enhance scalability by reducing transaction fees through operations carried out off the main blockchain. Since late last year, a growing number of users have opted for these solutions to experience faster and more economical transactions.
Impact of Blobs on Network Fees
Blobs, similar to ordinary transactions but containing additional data, do not permanently take up space on the primary network. Each blob is accessible only for 18 days, with Ethereum limiting them to six per block, aiming for a target of three. Upon reaching this limit, a base fee is implemented to control Layer 2 demand. Since November, the appetite for blobs has consistently exceeded the target of three, leading to fierce competition among many Layer 2s and rising base fees. The upcoming Pectra upgrade aims to increase the blob limit to nine per block by March 2025.
Prospects and Challenges of Future Upgrades
While the Pectra upgrade may offer a short-term fix, Santhosh argues that merely raising the limit is insufficient for long-term sustainability. The increasing demand for Layer 2 solutions is straining Ethereum’s main network, consequently driving up costs for users due to higher fees and limited blob availability.
Current and future challenges emphasize the need for long-term solutions to maintain the sustainability of Ethereum's network amid growing demand for Layer 2 solutions.
