Source: HashKey Capital
Five technology hotspots to watch in 2023
Major technical upgrades of Ethereum (Shanghai, Cancun)
Staking-related technologies and product services
Modular blockchain optimization and application-specific Rollup and other ecological developments such as “L3”
ZK applications in non-scaling areas such as ZK cross-chain bridges
Iteration of AA+MPC, Lightning Network, etc. in terminal applications
1. Ethereum’s important infrastructure upgrades in 2023
Shanghai Upgrade: The successful opening of withdrawals will dispel the security concerns of potential stakers, so the amount of staking is expected to increase. At the same time, the competition for staking projects will become more intense.
Cancun Upgrade: The content of the upgrade may still change, but it will be the most significant technical upgrade of Ethereum in 2023.
Proto-Danksharding: The goal is to reduce the transaction fees of the Ethereum mainnet. If the upgrade is successful, the performance of Ethereum will be improved by dozens of times, and it will also pave the way for the development of L2.
EVM Object Format (EOF): Optimize EVM, which is the first modification of EVM in Ethereum in two years. It will improve the performance of smart contract operation and reduce transaction fees.
Ethereum’s preparation for future technological developments in 2023
KZG Ceremony: It has been successfully launched in January 2023, providing a technical (cryptographic) foundation for Proto-danksharding. Next, the Danksharding standard will be formulated to solve the existing technical obstacles. It is unlikely to happen in 2023, but its successful upgrade will mark the success of Ethereum's expansion.
Important topics for Ethereum in 2023 - MEV, regulation and anti-censorship
MEV、Flashbots SUAVE:
Made into a chain: The corresponding builder is decentralized to make cross-chain heterogeneous chains
MEV unified platform: Expanding new MEV markets
Do orderflow: consolidate the existing MEV market position
Regulation and Censorship Resistance:
crList in the roadmap will prevent relayers from doing evil
PBS at the protocol layer: will realize the separation of proposal, construction, and verification.
Currently, staking has encountered a problem similar to the lucky value of PoW, which requires a method similar to PBS at the protocol layer to improve, otherwise it will endanger decentralization.
Decentralized blockbuilder network
2. After the Ethereum merger and Shanghai upgrade, the staking track will see more development in 2023
Liquid Staking: How to improve the liquidity of staked tokens. Currently, the most successful practice is stETH. As the Shanghai upgrade progresses, different staking schemes will emerge one after another, and their liquidity schemes will become the key to the success of staking schemes. Decentralized Staking: There are currently some decentralized staking products and schemes, but the liquidity of RocketPool and other products is too poor, and we need to find ways to improve it.
Restaking: The idea of “secondary staking” proposed by EigenLayer has attracted the attention of the community as a very good innovation. However, at the same time, this solution may also endanger the security of the Ethereum protocol layer.
DVT (Decentralized Validator Network): SSV and Obol are exploring technical solutions for decentralized validators, which is an important step in the development of staking decentralization.
Stabilization of staking income: Currently, the income gap between different staking nodes is too large, and a solution to stabilization of income is needed.
Ethereum multi-version client is worth paying attention to
Paradiom's Reth: It adopts a modular client design concept, making it easier for developers to combine components to achieve better development results.
a16z's Helios: Taking a completely different approach from most current clients, Helios couples the execution layer with the consensus layer client, and its effect is worth observing.
Browser: In order to solve the centralization problem of Etherscan, the community has begun to develop a self-hosted blockchain browser based on a new client, and the effect is worth paying attention to.
Other emerging technology topics in Ethereum
In addition to the old-fashioned content such as the roadmap, the Ethereum community also had more newer topics for discussion in early 2023, mainly including Stealth Address (FIP-5564, Lattice-based Cryptography, etc., but the specific implementation in Ethereum infrastructure and applications still needs to be observed in 2023.
3. Modular blockchain technology is still one of the hot technologies in 2023
Modular blockchain may make progress in many aspects and directions in 2023
New competitors in the data availability layer:
In addition to Celestia, more competitors will join the DA track in 2023, including Polygon Avail. Other interesting explorations include:
Arbitrum AnyTrust, intmax, etc. adopt a compromise route between Plasma and Rollup architecture
EigenDA is based on restaking technology, etc.
More flexible and efficient execution layer:
Fuel uses UTXO and highly parallel virtual machines to improve the execution efficiency of smart contracts
There will also be other more flexible execution layer networks such as Rooch
Layer2 Optimization Solution
AltLayer adopts the idea of modular Rollup, which is similar to the idea of Cosmos application chain OP
Stack: will support developers to quickly build and start Layer2
Stackr, dymension: "Build Your Own Rollup", quickly build application-specific Rollup
Layer2 Optimization Solution - Sequencer Centralization
Solve the Seguencer centralization problem
As L2 grows, the issues of L2 MEV and censorship will become more and more obvious. How to decentralize it will soon become the focus of market attention.
Shared sequencer, in conjunction with Rollup service, provides sequence services for Layer2 and Layer3 projects through shared sequencer, including Espresso, OP Stack, etc.
More Layer2 and “subnet”, Layer3
Building an ecosystem by building a Laver2 “subnet” will become more common. The competition of application chains in the ecosystem in the past may further extend to the competition of “subnets”.
The more noteworthy ones include: Avalanche (Subnet), Binance Chain (BeaconChain, zkBNB, Sidechains, Greenfield), and Shiba (Shibarium) which has transformed from a meme to a Layer2 ecosystem.
L3 supports the larger-scale expansion and adoption of blockchains. It has a similar purpose to Rollup modularization, but a completely different solution. Based on Laver2, it provides development tools and execution environments for further vertical expansion. For example, Starknet's Slush, zkSync's Opportunity, etc.
4. zkEVM mainnet is online, but it will take time for the technology to mature
zkEVM is undoubtedly one of the most noteworthy expansion developments in 2023. There will be many testnets and even mainnets launched in 2023. Including ConsenSyszkEVM, Polygon Hermez, Scroll, etc.
However, it may still take some time for the technology to mature (EVM compatibility, etc.)
In addition, it is estimated that hardware (ASIC) supporting zkEVM proof will have relatively mature and available products by the end of 2023.
But ZK applications are worth looking forward to
ZK’s application in other fields has made great progress in 2022 and will most likely continue in 2023, especially zkBridge
One method is to change the verification of the validator's signature (consensus status) on the light client to ZK proof.
The other is to ZK-ify PoS (consensus process)
Other cross-chain trends: multi-chain applications, MEV, inter-chain security, etc.
Multi-chain (full-chain) and cross-chain applications will be more
Applications of state aggregation. For example, cross-chain authentication of identities and records related to DID. ENS and other platforms are exploring this direction and have achieved some interesting results.
Liquidity sharing based on cross-chain general information, especially between Laver2, will become more common
Cross-chain MEV will most likely repeat the development on the single chain. In 2023, it is worth paying attention to customized node consensus layer solutions such as Skip Protocol, customized Tendermint, and Cosmos2.0 modified protocol layer solutions.
In addition, as Laver2 matures, the MEV problem between Laver2 and Laver1 will become more prominent. The Laver2MEV tool will also be improved as Laver2 matures.
Interchain Security: A shared security solution that Cosmos will implement in 2023. The idea of the restaking solution is similar to this solution, using staking to provide more services.
5. Wallet and User Application
MPC (TSS) will likely become standard: MPC is already mature for TSS (threshold signature) and will support more application scenarios such as custody and users without mnemonics.
Some designs of AA (account abstraction) (EIP4337) are close to completion, and the code development is progressing smoothly and will mature in 2023; the wallet product after combining with MPC will be very worth looking forward to
Payments and financial services on the Lightning Network will have more room for development in 2023:
0mniBOLT and Taro introduce stablecoins and custom asset types to expand the current application scenarios of the Lightning Network;
The DLC non-custodial solution may enable some financial derivative applications;
The social protocol Nostr and its combination with the Lightning Network may bring a new wave of traffic through its integration with the Lightning Network.
In addition, the L2 payment solution after Proto-danksharding will also be taken to a higher level in reducing costs and improving efficiency.
Web3 developer tools continue to improve
New programming languages and new ecosystems worth looking forward to
The Move language ecosystem may enter a critical period of developer growth with the launch of Aptos in 2022 and Sui in 2023.
The development ecosystem of Laver2, especially the development environment of zkvM and other classes that require translation, etc.
New developer tools accumulate technology for the next industry cycle
Low-code, no-code tools, new developer kits, and more
Data middleware layer and related tools enable better on-chain data indexing and data processing
Endpoint services for decentralization, faster execution, and richer functionality
