In The Weeds #3
Why you should care about Danksharding, Optimism's developer roadmap, and Ethereum's under-the-radar network upgrade
Welcome to Decentral Park’s new research sub-newsletter: In The Weeds.
This weekly instalment will focus solely on key technical developments and themes within Web3, keeping you ahead of the game on upcoming trends.
Let’s get stuck into this week’s key highlights.
1: Protodank-sharding (EIP-4844)
What is it?: Danksharding, created by Dankrad Feist, a veteran researcher of Ethereum, is a new sharding design proposed for Ethereum. The new design features a unified settlement and data availability layer, that instead of providing more space for transactions (traditional sharding), provides more space for ‘blobs’ of data. These blobs of data can be verified by merely checking if the blob is available (i.e. it can be downloaded from the network).
Danksharding was a step towards the rollup-centric roadmap adopted by Ethereum, with the intention being to have layer-2 rollup protocols using the data space in these blobs.
In an effort to take Danksharding one step closer to actualisation, a team of Ethereum researchers including Protolambda, built a full data-blob-transaction prototype. The prototype increased L2 capacity by 100x. This was ultimately coined ‘Proto-danksharding’, and became an EIP to implement the groundwork (e.g. transaction format, verification rules) that make up Danksharding, without implementing sharding itself.
Proto-danksharding (aka EIP-4844) is now a planned change to the Ethereum protocol. Its design means that data does not need to be stored on the network forever, vastly reducing the cost of using on-chain storage (calldata). What this means is that rollups can use this new ‘blob’ storage type to post transaction data or proofs back to Ethereum mainnet, resulting in significantly lower L2 transaction fees, and far greater scalability potential.
Why is it important? The implementation of EIP-4844 signifies the first practical implementation of ‘The Surge’ section of the Ethereum roadmap, a major step towards full sharding. As mentioned, the 100x capacity increase for rollups will result in a significant reduction in gas costs on L2s.
Alongside other factors, such as zkEVM mainnet deployments that will enhance the use case offerings on rollups, Proto-danksharding will play a pivotal role in the future of Ethereum, and the ultimate adoption of L2s.
Looking at current rollup gas costs, which are as low as $0.10 a transaction, implies Proto-danksharding would result in transaction costs on rollups as low as a tenth of a cent (or $0.001).
Where does it go from here?: According to Tim Beiko, EIP-4844 will be the primary focus on the Ethereum upgrade subsequent to Shanghai, expected in March. It is therefore plausible that we see its implementation before EOY.
As many themes converge (i.e. the deployment of zkEVMs, EIP-4844, the practical implementation of modular blockchains with data availability solutions such as Celestia) the inevitable mass migration of value and users to L2s and beyond gets closer. However, it’s worth noting that without these complementary themes, the migration from Proto-danksharding alone could be limited.
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2: Optimism Bedrock
What is it?: Bedrock is Optimism’s custom rollup architecture, building on their already impressive EVM-equivalent chain. Bedrock introduces features that reduce deposit times from 10 minutes to 2.5 (4x improvement) and reduces the cost of data submission to L1s by ~20% (this is on top of any cost enhancements that arise from EIP-4844).
Bedrock is Optimism’s way of saying that EVM-equivalence isn’t enough, instead, rollups should be aiming for Ethereum-equivalence, i.e. the full stack is as similar to Ethereum’s as can be. It has cut the difference between Bedrock execution layer client and Geth down to merely 500 lines of code.
Why is it important?: Optimism has historically led the way in rollup innovation and continues to do so with Bedrock.
Short-term, Bedrock is important because it removes a bottleneck to L2 adoption that is often overlooked: deposit times. The user experience in web3 at large is far from ideal, but a delay of 10 minutes in which users are unable to locate their funds creates uncertainty and has likely deterred many users from bridging their funds to L2s. Bedrock diminishes the wait times by 4x, reducing the time spent in uncertainty for users, and theoretically should result in more users being comfortable migrating to rollups.
Bedrock is important because it’s a step towards lower technical friction between rollups and mainnet Ethereum. Alongside complementary innovations such as zkEVMs, this will reduce the technical burden for use case migration, bridging providers etc., and enhance the Ethereum ecosystem experience.
Where does it go from here?: On the 12th January OP Labs successfully completed an upgrade of Optimism’s Goerli Testnet to Bedrock. All services including the sequencer, public RPC endpoint and bridge have completed their upgrade. Infrastructure providers such as Chainlink, The Graph and Etherscan have also completed their upgrade.
Bedrock underpins two subsequent technical upgrades: Cannon and OPStack, which will shape the future of Optimism. However, the most interesting aspect of Bedrock is that it supports any number of alternative proof systems, including Zk rollups. This could potentially be a hint that Optimism is preparing to offer a Zk-solution in the future. Optimism zkEVM anyone?
Failing that, Bedrock will likely be adapted for upcoming zkEVM solutions, to get one step closer to the end-goal: Ethereum-equivalence. Whatever the outcome, it’s clear that the lines between optimistic and Zk rollups are becoming increasingly blurred, with optimistic rollups having a limited hay day due to their inherent technical inferiority.
3: EVM Object Format
What is it?: An overarching goal of Ethereum is to promote simplicity, even at the expense of some data storage or time inefficiency. The motivation being to minimize the influence that any specific individual or elite group can have on the network by encouraging contributions from average programmers.
To-date, the approach to facilitating this has been to enable the EVM to read the input field of a transaction, i.e. where the smart contract code is housed, when completely unstructured. This means anything can be placed in this field, and the EVM will do its best to interpret it, regardless of its quality. The result being that the EVM spends a significant amount of resources trying to interpret junk code.
The solution to this problem is EVM Object Format (EOF). EOF changes the way in which the EVM interprets code from an entirely unstructured format, to a structured format. What this means is that rather than the EVM having to expend resources assessing every piece of code submitted to it, it will know prior to on-chain deployment whether or not code is passable. If it fails any of the necessary tests, the code is rejected.
Why is it important?: By introducing EOF, we would be reducing the extent to which scarce blockchain resources are expended on rejected code. While difficult to quantify the exact impact this would have on the future of the network, it is certainly a step towards Ethereum becoming a mature computing platform, while also increasing its capacity by reducing unnecessary use of resources.
Further to this, the introduction of versioning, a structured field within EOF that tags smart contract code based on which iteration it is, dramatically enhances the developer experience. Developers now have a powerful tool for introducing and removing features from their code, reducing the technical burden for use case deployment and improvement. This also works at a protocol level, reducing the burden of implementing an EIP. No longer will developers have to consider backwards compatibility, instead, they can merely apply legacy rules to historical incompatible versions, dictated by code and structure.
The ultimate result of these important enhancements is that use case deployment and improvement on Ethereum becomes easier.
Where does it go from here?: On January 5th Ethereum Core Devs decided to remove the implementation of EOF from the Shanghai upgrade, expected in March. Instead, much like Proto-danksharding, the implementation of EOF is said to be a focus post-Shanghai. As such, we can reasonably expect its implementation before EOY.
Once implemented, EOF will improve the developer experience within the EVM, and should increase use case deployment and improvement. Importantly though, it actually offers new use cases, such as account abstraction (see ‘In the Weeds #1’) utilising EOF and validation focused smart contract wallets.
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