In a recent discourse on the challenges plaguing Ethereum’s Proof of Stake [POS] system, co-founder Vitalik Buterin highlighted the critical issues surrounding staking centralization and transaction processing efficiency faced by Ethereum’s Layer 2 solutions1. Buterin’s insights shed light on the hurdles that Ethereum’s L2 ecosystem must overcome, emphasizing the pressing need for improved interoperability between Ethereum’s Layer 1 and Layer 2 solutions.
One of the primary concerns highlighted by Buterin revolves around cross-layer interactions. Ethereum’s increasing adoption of Layer 2 solutions necessitates a seamless method for users to manage assets across multiple L1s and L2s without being burdened by an excessive number of transactions. To address this, Buterin proposed a novel solution: the implementation of an innovative architecture called asset/keystore separation.
Under this proposed model, users would maintain a keystore contract that houses their verification key and the rules for its modification. Wallet contracts on both L1 and various L2s would read cross-chain to fetch the verification key, ensuring secure and efficient transactions. The Ethereum founder outlined two potential implementations of this system: a “light version,” where wallets store the verification key locally and update it with cross-chain proofs, and a “heavy version,” requiring cross-chain proof for each transaction, thus reducing keystore update costs but increasing per-transaction expenses.
Crucially, Buterin identified five types of proof schemes, including Merkle proofs and Verkle proofs, each offering unique pros and cons. However, he stressed the need for highly optimized cross-chain proofs to facilitate smoother transactions and reduce overall costs.
Ethereum: Enhancing Cross-Chain Interactions
Looking toward the future, Buterin emphasized the significance of aggregating proofs through bundling operations submitted by users, which could drastically reduce expenses. Additionally, Layer 2 solutions must minimize latency when reading the Layer 1 state. To achieve this, wallets can be deployed on systems with lower ETH connections, such as Layer 3s or separate chains. However, the Keystore should be maintained either on Layer 1 or on high-security zero-knowledge rollup Layer 2 to ensure robust security measures.
According to Buterin, Ethereum is inching closer to enhancing cross-chain interactions, implementing asset/keystore separation, and placing a heightened focus on privacy. These developments mark significant strides in Ethereum’s ongoing journey toward creating a more efficient, secure, and decentralized blockchain ecosystem.