Buterin also praised the rise of Ordinals recently, saying that he thinks they have restored the building culture to the Bitcoin community.
Ethereum co-founder Vitalik Buterin stated during a Twitter Space held by Bitcoin engineer Udi Wertheimer that the Bitcoin network requires scalable solutions like zero-knowledge rollups (ZK-rollups) if it is to become more than just a payment network. The topic of discussion was scaling experiments in Ethereum and the demand for scalability in both Bitcoin and Ethereum.
ZK-rollups are off-chain protocols that use on-chain Ethereum smart contracts to function on top of the Ethereum blockchain. They offer a more scalable and effective method of verifying transactions without jeopardizing the confidentiality and privacy of user data.
Related: Avoid overwhelming the Ethereum consensus, says Vitalik Buterin
Buterin emphasized Ethereum’s efforts over the years to implement alternative scaling solutions, mentioning rollups such as Optimism and Arbitrum as successful examples that might serve as case studies for Bitcoin. He stressed how crucial scaling solutions are if Bitcoin is to be used for more than just payments.
Scalability has been a recurrent theme in both Bitcoin and Ethereum discussions. To increase scalability, Ethereum has switched from a proof-of-work to a proof-of-stake network and is investigating several layer-2 solutions including ZK-rollups and Plasma.
On the other hand, Bitcoin has made use of the Lightning Network as its layer-2 solution, which has significantly increased scalability. The introduction of Bitcoin Ordinals, a layer-2 solution that enables decentralized storage of digital art on the Bitcoin blockchain, has also, in Buterin’s opinion, restored a building culture to the Bitcoin ecosystem.
By the end of June, trade volume for Bitcoin Ordinals had surpassed $210 million, indicating their tremendous increase in popularity. The layer-2 solution has increased the scope of the Bitcoin network’s functionality and shown the possibility for creative use cases beyond straightforward payments.
Related: Total mintage fees for Bitcoin Ordinals have increased by 700% since April.
The necessity of scaling in enabling greater functionality and value for blockchain networks is underlined by Buterin’s support for scaling solutions like ZK-rollups for Bitcoin. By implementing these fixes, Bitcoin can get past its scaling issues and provide new avenues for decentralized services and applications.
The constant efforts to increase the effectiveness, throughput, and adaptability of blockchain networks are highlighted by the continued emphasis on scalability and the investigation of various layer-2 solutions by both Ethereum and Bitcoin. The development and long-term viability of the cryptocurrency ecosystem as a whole are facilitated by these scaling projects.