By
Temitope Olatunji
April 18th, 2024
The cross L2 DEX solution and fast implementation of Ethereum 2.0 could rejuvenate ETH bulls in the near future.
Ethereum 2.0 is expected to solve existing challenges in the Ethereum ecosystem. According to Ethereum co-founder Vitalik Buterin, a cross L2 DEX capability is the expected solution for high fees for ETH 2.0.
A cross-L2 DEX solution that I proposed a few days ago that only requires one side to be smart contract-capable (the other side can just be a simple coin-sending-only rollup or plasma):https://t.co/kc65mkh37c
— vitalik.eth (@VitalikButerin) March 4, 2021
Ethereum developers are moving fast to salvage their reputation as high competition drive Dapps’ developers to other favorable ecosystems including Binance Smart Chain. Incidentally, the latter has experienced heightened activity in the past few weeks that has resulted in native coin BNB skyrocketing.
The high transaction fees have made all projects that are built on the Ethereum blockchain less scalable. Thereby prompting Ethereum 2.0 developers to put extra effort ahead of the schedule.
The cross L2 DEX solution will oversee a seamless transition of high fees to affordable fees especially as the crypto industry experienced heightened volatility and institutional adoption.
Despite the increased competitors, the Ethereum ecosystem remains the ruler in the smart contract industry. Besides, Ethereum (ETH) is the second-largest cryptocurrency by market capitalization after Bitcoin. Whereby it had a market capitalization of around $170 billion.
Ethereum 2.0 and L2
Ethereum 2.0 was planned to be implemented in phases for the next few years. However, the increased transaction fees have prompted Ethereum investors and developers to reschedule the process. The ecosystem is entirely planned to migrate from the power-consuming proof-of-work to proof-of-stake.
Eventually, interested investors can stake their Ethereums to become a validator. The minimum set of ETH units to become a validator is 32, thus approximately $47k.
Notably, the L2 Optimism solution that is meant to reduce transaction fees was funded by venture firm a16z (Andreessen Horowitz). Moreover, Optimism is set to launch on Ethereum 2.0 mainnet next month. According to a16z, Optimism is “an extension of Ethereum, [with] adherence to Ethereum development paradigms, [which] results in a very easy transition for developers, wallets and users.”
The Ethereum ecosystem is also awaiting other events including the upcoming Berlin hard fork that is scheduled on April 15. Notably, HF1 is the tentative code name for the first hard fork of the beacon chain. The main purpose for the HF1 on the beacon chain is to add light client support, fix existing weaknesses, and test hard forking mechanisms.
The beehive of activities in the Ethereum ecosystem spell for further growth, especially the market price. Ethereum was trading around $1,481.33 having dropped approximately 27% from its all-time high set last month. The cross L2 DEX solution and fast implementation of Ethereum 2.0 could rejuvenate ETH bulls in the near future.