Key Points
- Ethereum’s new proposal, EIP 7781, could potentially increase its throughput performance by 50%.
- If accepted, the proposal could help Ethereum compete with other top Layer 1 (L1) blockchains in terms of throughput.
Ethereum [ETH] researchers have put forth an important proposal aimed at boosting the platform’s performance. The proposal, referred to as EIP 7781, is designed to enhance throughput performance by up to 50%.
The Proposed Changes for Ethereum
Ben Adams, a contributor at Netherminds, an Ethereum execution client, is the person behind this proposal. His suggestion involves reducing the slot times from the current 12 seconds to just 8 seconds.
In Ethereum’s Proof-of-Stake (PoS) system, a block is proposed every 12 seconds, a period known as a slot. For each slot, a validator is chosen to propose the block. This feature is a key component of Ethereum’s transaction throughput capacity. Therefore, decreasing the slot times could significantly amplify the throughput capacity.
Support for the Proposal
Justin Drake, another Ethereum researcher, has also shown his support for the proposal. He highlighted the potential the proposal has to enhance the efficiency of decentralized exchanges (DEXes). According to Drake, the proposal could save DEXes approximately $100 million per year in arbitrage executions.
If the proposal gets the green light, Ethereum’s throughput could see an improvement of 50%, with the gas and blob limit capped at 45 million and 9, respectively. The Ethereum community has largely welcomed the proposal, viewing it as a potential game-changer for Ethereum’s performance.
Mathew Sigel, head of digital assets research at VanEck, believes the proposal could restore some power to Layer 1. However, the potential negative impacts of the proposal are still largely unknown. Sigel is of the opinion that the move could help reverse Ethereum’s declining value.
Ethereum has been the target of significant fear, uncertainty, and doubt (FUD) recently. After the Blobs update in March 2024, its declining value was blamed on its inflationary nature. Whether the proposal will be approved and how it will impact Ethereum’s dynamics is still uncertain.
At the moment, Solana [SOL] is the fastest blockchain, boasting a speed of 785 transactions per second (tps). If the Firedancer client is launched on the Mainnet, it could potentially achieve thousands or even millions of tps.
Currently, Ethereum ranks 15th on the list of fastest blockchains. It still lags behind Solana, even with its Layer 2 scaling solutions. However, if the proposal is approved, it could help Ethereum close this gap.
