This article was first published on Loopring Protocol - Medium
The Bottlenecked Blockchain: How High Gas Fees On Ethereum Are Killing My Vibe (and What We Do About It)
Guest post, written by Matthew Chaim
I, like many, have fallen down the Ethereum rabbit hole.
As an artist myself, I’ve gravitated primarily to the world of crypto art and Non-Fungible Tokens (or NFTs). As such, I am far more interested in playing with the platforms built atop the Ethereum blockchain — be it NFT marketplaces, tokenized DAOs, etc — than understanding all of what’s going on under the hood.
So when it came to learning about these transaction costs on Ethereum called “gas”, I didn’t really care to dig too deep — so long as they didn’t prevent me from moving ETH and other tokens around.
Now gas is the only thing on my mind, for it has quickly become the bottleneck preventing me from continuing my exploration across the Ethereum network.
So what is causing this problem? And what are its possible solutions?
Dams Be Damned
I recently listened to an interview with crypto expert Andreas Antonopolous, in which he shared an analogy that I find quite fitting to this moment. He was talking about the difference between centralized and decentralized systems — equating centralized systems to dams built to contain and control the flow of value, and decentralized systems like Bitcoin and Ethereum to holes drilled into those dams. Eventually, all that value is going to find its way through those holes.
We are seeing this happen now, as more and more people move their money out of fiat and into decentralized cryptocurrencies. The problem? That little hole in the dam called Ethereum is still too small to handle all incoming transactions. With this congestion, the price to play has gotten so high that little fish like me are treading water, unable to move.
So, how do we widen the hole?
Eth2 and Layer-2 Solutions
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Loopring Protocol - Medium