tl;dr
Ethereum faces scalability challenges in supporting the growth of layer-2 (L2) networks due to limited blob space capacity, even after planned upgrades like Pectra. Current blob capacity risks becoming insufficient as L2 transaction throughput increases, potentially driving transaction fees to unsus...
Ethereum’s current and planned increases in blob space fall short of supporting the rapid growth in layer-2 (L2) transaction throughput, posing risks of higher fees and network congestion.
Base, Coinbase’s L2 blockchain, highlights both the lucrative economic potential and the growing scalability pressure on Ethereum’s mainnet infrastructure.
Ethereum’s L2 scaling strategy crucially depends on expanding blob capacity to keep transaction costs low and remain competitive against alternative blockchain solutions.
Without timely and effective upgrades, Ethereum risks reverting to higher base layer fees, undermining the advantages of L2 networks and threatening its position as a core decentralized infrastructure.
Despite upgrade plans like Pectra, which increases blob targets from three to six blobs per block, Ethereum may still face insufficient capacity as transaction throughput on L2s like Base, Arbitrum, and Optimism surges.
Simulations suggest that a tenfold increase in transactions per second could drive fees up to $0.64 per transaction, far above the desired low-cost threshold.
Future enhancements under research, such as PeerDAS and Fusaka, aim to scale blob capacity further, with projections indicating at least 33 blobs per block are needed to maintain L2 transaction fees under $0.02.
Without these upgrades, Ethereum's mainnet may experience congestion that jeopardizes the overall L2 scaling model.
Base demonstrates Ethereum's opportunities and challenges vividly.
Since launch, Base has generated over $106 million in user fees, onboarded more than 155 million addresses, and bridged 1.9 million ETH (about 1.6% of circulation).
Applications on Base have accumulated $768 million in fees, and Base has contributed around $4.5 million in blob and settlement fees to Ethereum’s layer-1 validators.
However, Base also places intense demand on Ethereum’s infrastructure, averaging 93 transactions per second over six months—a scale that, when multiplied across multiple L2s, strains blob space availability.
Base’s growth, with nearly $10 billion in total value secured via applications and stablecoins, underscores the urgency of maintaining affordability and speed across all L2 networks.
The strategic shift toward an L2-centric model positions Ethereum primarily as a security and settlement platform, with L2s offloading transaction activity and generating economic value through blob fees.
The success of this model hinges on Ethereum’s ability to increase blob capacity without excessive costs.
Failure to scale effectively could drive developers and users to alternative data availability solutions or competing layer-1 blockchains boasting lower fees.
Without proportional blob throughput upgrades, Ethereum risks a fee rebound on the base layer that negates L2 cost advantages.
Under a tenfold L2 scaling scenario, Ethereum’s annualized revenue could reach approximately $1.4 billion, mirroring its current fee generation but signaling limits to affordable scalability.
In summary, Ethereum’s capability to foster a thriving L2 ecosystem depends on sustained technical innovation and effective mainnet upgrades.
Expanding blob space is essential to safeguarding Ethereum’s role as the backbone for decentralized applications and settlements in the evolving blockchain landscape.
Failing to meet these demands could compromise Ethereum's competitiveness and the affordability users expect from its scaling roadmap.