Opinion: Leo Fan, co-founder of CYSIC
Running Ethereum today is like trying to play a modern game on a laptop in the 1980s. Obsolete hardware is loaded with the weight of new demand, causing endless delays and perhaps struggles to crash. Designed for a simpler blockchain era, Ethereum’s infrastructure is no longer able to handle just 10-62 transactions per second, far less than the thousands needed for mainstream adoption.
Meanwhile, with a block time of 1 second and a fee of close to zero, Solana enjoys the growing popularity of mainstream popularity. Ethereum is hampered by high gas prices and congestion, pushing users and developers onto faster alternatives.
Without addressing scaling bottlenecks, Ethereum risks falling behind. Ethereum’s Layer-2 (L2) rollup reduces network congestion, but ultimately serves as a shutdown measure that provides temporary relief. The Software-First Approach has experienced dental issues with interoperability and scalability, raising questions about the long-term sustainability and relevance of Ethereum.
Many L2s are designed to fit native networks and cannot support real-time applications such as decentralized games and cross-border payments. Ethereum needs radical change if you want to maintain leadership in the blockchain space. The solution is not in incremental software updates, but in hardware acceleration.
Match your Ethereum vision to your hardware
Vitalik Buterin’s Verge Milestone envisions Ethereum, which achieves full node verification on consumer-grade devices. This is an important step towards the broader goals of blockchain accessibility and decentralization. Buterin emphasizes shifting from patchwork solutions to building a balanced computing infrastructure to realize this vision. Dedicated hardware such as application-specific integrated circuits (ASICs) is important. Increase transaction processing speed, reduce latency and optimize energy usage. It lays the foundation for sustainable Ethereum scaling and ensures that your network grows without undermining core principles.
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Ethereum’s Pectra upgrade does not completely solve the basic scaling challenges, highlighting the urgency to improve scalability and stability. The major optimizations introduced – account abstractions and enhanced validator operations – seek to improve Ethereum’s efficiency and user experience, but do not significantly increase transaction throughput or reduce network latency.
Ethereum risks lagging behind without special hardware, weakening its position as a payments layer in the blockchain community. Investing in hardware native solutions allows Ethereum to scale effectively while supporting its commitment to diversifying and supporting a growing user base.
Mainstream adoption and real-world applications
The effectiveness of hardware scaling solutions is far beyond Ethereum itself. TRADFI players are seeking blockchain-based cross-border payments that require real-time processing. Due to scalability issues inherited from the home layer, it cannot effectively scale with L2S alone to meet the pure Tradfi demand. Cross-border transactions reached $190.1 trillion in 2023, and are expected to grow only in 2025, indicating one thing. Acceleration of hardware is essential to encouraging institutional adoption of blockchain.
Beyond finance, hardware optimization will strengthen blockchain utilities across the industry and accelerate mainstream adoption. A noteworthy example is healthcare, where accelerating blockchain infrastructure can improve patient data security and privacy. For the gaming industry that relies on dynamic dialogue, blockchain networks can help provide real-time responses to user actions.
AI Factor
The blockchain does not work on its own. It competes with computational intensive industries such as AI, the buzzword of 2024. The rise of AI has reshaped the industry, but it is also becoming a fierce competitor of the power and equipment blockchain. Data centers such as Hut 8 and Coin Scientific prioritize AI workloads with up to 25 times more revenue from Bitcoin (BTC) mining. These moves highlight the increased pressure on blockchain networks, and run the risk of optimizing resource efficiency and being sidelined in a competition for computational advantage.
Critics argue that Ethereum is “slowly dying.” The scalability issues of Ethereum, once home to decentralized financial (DEFI) innovation, hamper their ability to compete with DEFAI. Ethereum must accept dedicated hardware to address its inefficient infrastructure, enable faster transactions, and reduce energy consumption. Thus, Ethereum will provide a future prevention opportunity for AI development and will remain competitive for mainstream adoption.
Now is the time to invest in hardware
Ethereum relies heavily on L2S to scale, but remains a temporary solution that does not meet the basic operational demands of the network. Hardware solutions are currently unnegotiable to ensure that Ethereum remains a leader in blockchain innovation. From enabling seamless TRADFI integration to supporting real-time interactions in gaming and healthcare, dedicated hardware addresses the root inefficiency of Ethereum infrastructure. Without a critical investment in hardware acceleration, Ethereum risks stagnation while competitors are on the rise.
Ethereum does not require another short-term patch. You need a permanent solution. The next wave of blockchain adoption requires infrastructure that can be supported. So you’re investing your hardware investments right now.
Opinion: Leo Fan, co-founder of CYSIC.
This article is for general informational purposes and is not intended to be considered legal or investment advice, and should not be done. The views, thoughts and opinions expressed here are the authors alone and do not necessarily reflect or express Cointregraph’s views and opinions.
