On rollups and data availability

Ethereum gas prices have grown significantly since the DeFi summer of 2020. While there are occasional periods of lower gas prices, the main problem remains that Ethereum is not well-suited to handle high transaction throughput. As such, whenever a popular NFT project or DeFi protocol is launched, it is often followed by spikes in gas prices.

High gas prices are the result of Ethereum’s design. Since users can freely bid for their transactions to be included in the next block, and since block space is limited, when the demand for block space is high, it naturally drives the price of gas higher. Ethereum 2.0 (now named the consensus layer) is meant to alleviate this by introducing shard chains, which increases the block space for calldata to be posted. Calldata refers to the data of the transactions which were invoked but not executed.