The Future of Ethereum: Unveiling the Revolution of the ‘Based’ Movement
The Ethereum network is currently undergoing a significant transformation known as the ‘based’ movement, which is revolutionizing the way applications and services operate on the platform. This innovative approach, spearheaded by based-sequencing and pre-confirmations, aims to address the long-standing issue of fragmentation within the Ethereum ecosystem, ultimately reshaping the future of blockchain technology.
Understanding the Fragmentation Issue
With the introduction of rollups to enhance transaction efficiency and throughput on the Ethereum network, a new challenge emerged in the form of fragmentation. These rollups inadvertently created isolated silos, each with its own developer ecosystem and liquidity pools, deviating from Ethereum’s core principles of interoperability and shared liquidity.
The roadmap for rollups, including solutions like Optimistic and ZK-rollups, aimed to process transactions off-chain to alleviate congestion. However, the fragmentation of liquidity across different rollups, estimated at a staggering $44 billion, has led to a breakdown in composability. This poses risks for users navigating multiple rollups and associated smart contract vulnerabilities, highlighting the urgent need for a cohesive solution.
Block Building and Sequencing
In addition to rollup fragmentation, challenges within the block-building ecosystem have arisen from various sidecars, such as MEV, which can compromise network security and increase complexity. This presents a significant obstacle for individual stakers unable to run multiple sidecars, favoring larger staking protocols.
Sequencing is a critical component in managing transaction ordering within Layer 2 protocols. The diverse sequencing methods employed by different rollups introduce risks of centralization and censorship. However, based-sequencing offers a promising solution by utilizing Ethereum’s validator set for decentralized transaction processing, ultimately reducing fees and enhancing network decentralization.
The Based Movement Demystified
While the ‘based’ movement is not a novel concept in the blockchain space, it has gained momentum as a viable solution to Ethereum’s scalability challenges. By harnessing Ethereum’s validator set, based-sequencing enables decentralized transaction processing that preserves network effects while mitigating historical obstacles like high fees.
The integration of pre-confirmations further complements this approach by allowing validators to commit to transaction inclusion, reducing confirmation delays and enhancing the user experience. These innovations are driving the based ecosystem forward, with several projects already live and more on the horizon by 2025.
Implications for Ethereum’s Future
The based movement has the potential to extend beyond Layer 2 solutions, offering a foundation for launching applications and services directly on Ethereum’s Layer 1. This framework establishes a shared security standard across the network, promoting seamless interoperability and incentivizing developers to choose Ethereum over fragmented sub-ecosystems.
By connecting Ethereum’s validator set directly to applications, an infrastructure layer could streamline operational processes and bootstrap new projects efficiently. As the based ecosystem continues to evolve, platforms like the SSV Network are positioned to play a pivotal role, leveraging distributed validator technology to enhance the capabilities of the Ethereum network.
In conclusion, the ‘based’ movement represents a significant shift in the Ethereum landscape, with the potential to redefine the future of blockchain technology. By addressing fragmentation and embracing innovative solutions like based-sequencing, Ethereum is poised to maintain its position as a leader in the cryptocurrency space, driving towards a more interconnected and efficient ecosystem.
