Vitalik Buterin Highlights the Need for Ether Integration in Scaling Plans.

Vitalik Buterin Advocates ETH-Centric Scaling to Enhance Ethereum’s Value Proposition

Ethereum co-founder Vitalik Buterin has urged the ecosystem to prioritize ether (ETH) in its scaling strategies and application designs, emphasizing the need to elevate ETH’s role as a central asset in the Ethereum network. In a blog post on Friday, Buterin outlined his vision for ensuring ETH’s long-term value and utility.

“We should aim for a comprehensive strategy that firmly establishes ETH as a triple-point asset, driving its use across Layer 1 and Layer 2 systems,” Buterin wrote. He encouraged the Ethereum community to promote ETH as the primary collateral in decentralized applications while building incentives for L2 networks to integrate ETH more deeply into their economic models.

Proposed mechanisms include burning transaction fees, staking proceeds permanently, or channeling a portion of revenues toward funding public goods in the Ethereum ecosystem.

Buterin’s call for action comes at a time when ETH is facing increasing market challenges. The ether-bitcoin ratio has declined to its lowest point since 2021, with Bitcoin hitting an all-time high of $109,000 and delivering a 160% return over the past year. In comparison, ETH has gained just 40% in the same period and remains 30% below its 2021 peak, according to CoinDesk data.

Buterin also highlighted blobs as an untapped revenue source. He suggested increasing the blob count and implementing minimum fees for blobs. “If demand remains steady and blob count rises to 128, Ethereum could burn 713,000 ETH annually,” Buterin noted, though he cautioned against relying solely on this strategy due to market uncertainties.

Blobs are a transaction type that includes additional data but only occupies mainnet space temporarily, accessible for 18 days. Blob activity has surged, with daily averages reaching 21,000 blobs since November. Two Layer 2 networks, Coinbase’s BASE and World Chain, accounted for 55% of this usage, highlighting their growing significance in Ethereum’s scalability roadmap.

By focusing on ETH as a cornerstone of the ecosystem, Buterin’s proposals aim to secure Ethereum’s position in the crypto space while addressing its competitiveness in the face of rising market pressures and shifting dynamics.