Ethereum's next decade: Vitalik Buterin discusses the high-priority work to come for ETH 1.x and 2.0 teams

Ethereum co-founder Vitalik Buterin has outlined his vision for Ethereum 2.0 in the next five to ten years, which, according to him, has transitioned from "blue sky" research to implementable projects.

In a recent tweet, Buterin published a flowchart summarizing the development work that needs to be done to ensure the network's smooth transition from Proof of Work (PoW) to Proof of Stake (PoS) as ETH 2.0 Phase 0 is nearly ready for implementation.

Buterin previously revealed to The Block that the major push for phase 0 multiclient testnets would likely happen in April. "Then we wait for that testnet to run for some time without issues, and if it does then we launch," he said at the time.

It's difficult to pinpoint the exact date for the Phase 0 release. But based on the launch requirements, Preston van Loon, CEO at ETH 2.0 client implementation team Prysmatic Lab, previously predicted a Phase 0 launch late in the second quarter of 2020.

In the thread accompanying the roadmap, Buterin claimed that ETH 2.0 has successfully shifted from a mere research topic to a concrete project with specific, implementable goals. 

"In general, over the last 2 years there has been a solid shift from 'blue sky' research, trying to understand what is possible, to concrete research and development, trying to optimize specific primitives that we know are implementable and implement them," Buterin said. "Additionally, over the last ~2 years there has been an increasing move toward maintaining compatibility and ensuring a smooth transition for applications, as well as making eth1.x and eth2 fit together as part of a coherent vision."

Progress on ETH 1.x

ETH 1.x brings together a number of upgrades to the existing PoW protocol and aims to continue improving the Ethereum network as ETH 2.0 is implemented. 

Speaking to The Block, Buterin pinpointed several projects that ETH 1.x teams are making the greatest progress on. 

"Progress has been accelerating quickly," he said. "The main eth1.x projects that are making a lot of progress now are EIP 1559, conversion from a hexary tree to a binary tree, and figuring out the protocol changes needed to make sure witness sizes of blocks do not get too big."

EIP 1559, if implemented, would mark a fundamental change to Ethereum’s economic model by replacing the “first price auction” fee model. 

Under the current system, users submit transactions with particular gas prices. Miners then pick the transactions with the highest bids. This model has many shortcomings, according to the proposal, including volatile transaction fees, delays for users, frequent fee over-payment, and instability of blockchains with no rewards. 

The new mechanism proposed in EIP 1559 would introduce a base network fee that is constantly adjusted based on network demand. This is intended to make transactions less costly and improve the overall efficiency of the transaction fee market. According to Buterin, who co-authored the EIP, the change would provide short-term usability relief for the network, enabling layer 2 improvements to privacy and security. 

EIP 1559 was first created in April 2019 and is now pushing through internal testnets. "We're starting to have testnets and more analysis," Buterin told The Block. "So making progress."

The second ETH 1.x project that Vitalik highlighted is the proposed conversion from a hexary to a binary tree, which would alter the way accounts and contract data are stored on the network.  Right now, accounts are stored into a hexary tree.

"It's a nightmare to verify Merkle branches of [the hexary tree], make efficient multi proofs for it, or other tasks that are simple in well-designed Merkle trees," said Buterin in a tweet last month. "We need to replace the patricia hex tree with a (RLP-free) binary tree asap."

The project has been making considerable progress, according to Buterin, now featuring a blueprint of how the switch will happen. In a March 16 blog post, the proposal's author, Guillaume Ballet, disclosed that he has already created a low-resolution prototype and is working to refine the algorithm further.

The conversion, Buterin previously explained, would help bound the witness size -- the size of the Merkle proofs that must be provided for a stateless client to verify a block. As shown on his latest roadmap, the conversion to a binary tree is an important component for the path to stateless Ethereum.

Combined with gas repricing and code merklization, the change would make semi-light clients more possible at large scale and make the ETH 1.0 chain more ETH 2.0 friendly. 

ETH 2.0: a focus on scalability and simplicity

ETH 2.0 will follow a multi-stage rollout.

Phase 0 will feature two active Ethereum chains: the current PoW main chain and the ETH 2.0 Beacon chain. Phase 1 will see the deployment of the 64-shard chains, though without much functionality. Phase 2 will introduce structured chain states, smart contracts, a virtual machine on EWASM, and other features that will enable transactions on the side chains.

Notably, the ETH 1.0 and 2.0 chains will not be merged until after Phase 1.

Buterin emphasized ETH 2.0’s significance when it comes to increasing the network’s scalability and reducing its complexity. ETH 2.0’s shard structure is intended to significantly improve the blockchain’s scalability by multiplying the current network throughput by 64. According to Buterin, ETH 2.0’s ability to hold more data will enable "ultra-scalable rollups," which use ETH 2.0’s data availability backbone to push the throughput of rollups to a high level of more than 100,000 transactions per second.

Moreover, Buterin argued that the ecosystem needs not fear further complexities added to the network. In fact, he said, a number of ongoing projects actually aim to reduce complexity. 

"The hexary to binary tree change is one," he said. "Another is moving away from RLP to simpler serialization algorithms. A third is that a lot of complexity around the ethash PoW implementation will go away."

He also emphasized the "quadratic sharding at end of history" approach. In other words, going forward, there will not be any upgrade as large as ETh 2.0. Rather, smaller-scale improvements will be made on an incremental basis. 

While his roadmap did not set out hard requirements for phase 2 and beyond and merely listed preferred changes on an as-need basis, Buterin told The Block that the transaction execution model and witness compression are of the highest priority for the team.

"I think finalizing the transaction execution model is fairly high-priority, so applications can benefit from eth2's scalability directly without using a rollup," he said. "Also witness compression using polynomial commitments or possibly SNARKs/STARKs over Merkle trees is very valuable and would be nice to do soon; it could reduce the size of a block witness from 1 MB to <100 kB."

Additionally, as The Block previously reported, a recent audit report of ETH 2.0's specifications has revealed security vulnerabilities regarding the protocol’s P2P messaging system and block proposer system.

Buterin claimed that the team is working to implement a Single Secret Leader Election (SSLE) mechanism as well as a BAR-resilient gossip protocol to address the problems, although these changes will likely take place later on.

Besides the two above-mentioned issues, Buterin said he is also concerned with micro-incentives as another potential area of security vulnerabilities. 

"I'm most concerned around micro-incentives," he said. "E.g. are there incentives to publish blocks too early or too late, or publish attestations too early or too late."