You are reading an excerpt from our free but shortened abridged report! While still packed with incredible research and data, for just $20/month you can upgrade to our FULL library of 50+ reports (including this one) and complete industry-leading analysis on the top crypto assets.
Becoming a Premium member means enjoying all the perks of a Basic membership PLUS:
- Full-length CORE Reports: More technical, in-depth research, actionable insights, and potential market alpha for serious crypto users
- Early access to future CORE ratings: Being early is sometimes just as important as being right!
- Premium Member CORE+ Reports: Coverage on the top issues pertaining to crypto users like bridge security, layer two solutions, DeFi plays, and more
- CORE report Audio playback: Don’t want to read? No problem! Listen on the go.
Roadmap
There is no official roadmap for Ethereum, as it is predicated more on rough community consensus. However, a high-level, noncontroversial plan stretching into 2023-24 is generally regarded as the agreed-upon path for the project. A more technical roadmap with the progress of each step filled in was updated by Vitalik Buterin in December 2021. Specific developments are tied to future upgrades and are always subject to change. A high-level diagram of the roadmap can be seen below.
Unofficial Ethereum roadmap (with progress bars) spanning into 2023. Source
Shanghai is the next hard fork planned post-Merge, slated for sometime in 2023. Beyond just enabling staked ETH withdrawals, it could also implement the following EIPs:
- EIP-3540: EVM Object Format (EOF) v1
- EIP-3651: Warm COINBASE
- EIP-3670: EOF - Code Validation
- EIP-3855: PUSH0 instruction
- EIP-3860: Limit and meter initcode
- EIP-4895: Beacon chain push withdrawals as operations
These EIPs look to make running a validator easier, Ethereum more efficient, and, yes, introduce Beacon Chain withdrawals. The official Ethereum site states, “After the Shanghai update (planned to follow the Merge by a few months), stakers will then be able to withdraw rewards and funds from their validator balance.”
Following a successful Merge, users will be clamoring for the ability to collect their rewards and potentially unstake their ETH after nearly three years of being locked up. It will be interesting to see just how much ETH gets staked prior and what percentage of users look to unstake. However, not everyone can unstake at the same time as there’s a cap on the number of ETH that can be unstaked over a given period. Should demand exceed this limit, a queue will form, and users will have to wait days (maybe weeks?) before successfully unstaking and taking ownership of their ETH.
The roadmap can be broken up into the following informal stages:
- The Merge: Merging consensus and execution layers, removes PoW.
- The Surge: introducing sharding, ~2023.
- The Verge: Optimise for storage and state size.
- The Purge: Reduce congestion and improve storage.
- The Splurge: Miscellaneous optimizations.
Ethereum’s roadmap is constantly evolving; however, the flagship upgrades post-merge are the introduction of shard chains to help the network increase transaction throughput, improvements to rollups, and improving Ethereum’s ability to manage data storage. Utilization of Zero-Knowledge (ZK) snarks is also very possible in the future as a means of reducing the storage requirements on-chain while ensuring relatively easy validation.
These stages on the roadmap are not sequential and are being worked on concurrently.
The Surge
The Surge itself then is focused on improving scalability at its data availability layer through data sharding. Sharding is the partitioning of a database (or blockchain) into subsections. Rather than building layers atop one another (e.g., L2s or Bitcoin’s Lightning Network), sharding scales out or horizontally without a hierarchy or layered structure. Doing so does not create more burden for the average user.
In this sharding model, validators are assigned to specific shards and only process and validate transactions in that shard. In Ethereum's planned sharding model, validators are randomly selected. Every shard has a (pseudo) randomly-chosen committee of validators that ensures it is (nearly) impossible for an attacker controlling less than ⅓ of all validators to attack a single shard. This also means they are only responsible for processing and validating transactions in those specific shards, not the entirety of the network. The randomness of the validator selection process ensures it’s (nearly) impossible for a nefarious actor to successfully attack the network.
Shards will be divided among nodes so that every individual node is doing less work. But collectively, all of the necessary work is getting done—and more quickly. More than one node will process each individual data unit, but no single node has to process all of the data anymore.
EIP-4488
Rolling out a 100% complete version of danksharding is incredibly complex and will likely take 1,2,3+ years. Because of this, there are intermediary options being discussed, including EIP-4488 and EIP-4844 (proto-danksharding).
EIP-4488 is the simplest and quickest way to improve rollups and drive down costs. However, it also has the least amount of attention currently. So, what is it?
EIP-4488 attempts to reduce rollup costs (while mitigating storage bloat) through two primary factors:
- Reduce calldata cost from 16 gas per byte to 3 gas per byte
- A limit of 1 MB per block plus an extra 300 bytes per transaction (theoretical max: ~1.4 MB)
This change could be implemented in terms of months, not years, and could reduce rollup costs by ~80%!
EIP-4844 (Proto-danksharding or PDS)
Proto-danksharding (PDS) is an alternative to EIP-4488 but is still a temporary stepping stone to the ultimate goal of “full” danksharding. However, even PDS is quite complex. Rather than rollups using "calldata" storage (permanently on-chain), under PDS, rollups could post bundles under a new “blob” transaction type which is much cheaper.
Rollup transactions would have their own “channel,” operating through a novel data blob market that uses its own fee structure and floating gas limits. This means that even with heightened demand and activity from DeFi or NFTs, data costs won’t go up for rollups. This creates two different gas markets - one for general computation and one specifically for data availability (DA), making the overall economic model more efficient than it was previously.
Data blobs are an entirely new transaction format, and only the blob’s hash can be accessed via a new opcode. This guarantees the data content will never be accessed by the EVM, reducing the gas cost of posting the data compared to with calldata. Blob transactions can enable up to ~1MB average per block for data storage as opposed to the 10KB currently with calldata. It also has been proposed that they could be pruned (removed) from the L1 after a ~month to reduce storage overhead requirements.
