Ethereum scaling plans and network applications must start supporting the network’s native ether (ETH) to further cast value for the asset, co-founder Vitalik Buterin wrote in a post on Friday.
“We should pursue a multifaceted strategy to cover all major possible sources of the value of ETH as a triple asset,” Buterin said as part of a longer post on layer-2 scaling, security and interoperability. “Broadly agreed to cement ETH as the primary asset of the larger (L1 + L2) Ethereum economy, supporting applications using ETH as the primary security.”
Buterin called for the implementation of incentives for layer 2 networks to allocate a portion of their fees to ETH using mechanisms such as burning fees, staking them permanently or directing the proceeds towards public goods in the Ethereum ecosystem.
His comments come amid mounting criticism of the Ethereum Foundation, the grantmaking nonprofit that helps support Ethereum as the asset loses market cap and mindshare to competitors.
The widely watched ether-bitcoin ratio is down to 2021 levels. Bitcoin touched a record high above $109,000 earlier Monday and has returned 160% to investors in the past year. Ether, meanwhile, has only gained 40% in the period and is hovering around 30% below its 2021 peak, as a Coindesk analysis showed.
Another call was to increase Ethereum’s orb count while setting a minimum price for blobs and seeing them as “another possible revenue generator.”
“If you take the average BLOB fee for the last 30 days and assume it stays the same (due to the induced demand) while the Blob Count increases to 128, Ethereum would burn 713,000 ETH per Year,” Buterin noted, adding that such a favorable Demand Curve was “not guaranteed” and thus not an isolated strategy to blunt ETH’s value.
Strikes are like regular transactions with an extra piece of transaction data attached. However, unlike traditional transactions, blob-bearing transactions do not permanently occupy the mainnet area and are only available for 18 days.
Since November, the daily number of blobs averaged a record 21,000, with just two layer 2s — Coinbase’s base and world chain — accounting for 55% of daily activity. Sustained demand for Layer 2s could quickly exhaust available capacity, as a Coindesk analysis noted earlier this week.
