Ethereum is a decentralized global software platform often referred to as “the world’s programmable blockchain.” It positions itself as an electronic, programmable network with a built-in Turing-complete programming language.
Thanks to its programmability, numerous applications worth billions of dollars have been built on the platform. As a result, the protocol has undergone several evolutions, implementing a series of proposals.
On the flip side, there has been a surge of curiosity surrounding integrating features like privacy, advanced cryptography, account safety, censorship resistance, frontrunning protection, and more into the core protocol.
To approach this aspect carefully, Vitalik imparted four fundamental lessons that should shape the inclusion of additional utilities within the layer one blockchain.
Enshrining features mitigate centralization risks elsewhere
According to Vitalik, embedding certain features outside the Ethereum core offers the advantage of minimizing the likelihood of centralization. Simplifying the base protocol allows for increased flexibility.
Nonetheless, he cautioned about the potential risks of centralization within the external ecosystem, often due to elevated fixed costs. Despite these risks, it remains beneficial in reducing de facto centralization.
Possibility of straining protocol trust and governance
Another lesson pointed out by the co-founder is that when too much is added to the Ethereum core, there is a likelihood that it will be overwhelmed due to overload.
The effect of this is that trust and governance of the protocol can be affected, potentially weakening Ethereum’s credibility.
Too much load can increase in protocol complexity
The third reflection of Vitalik is that when too much is given to the Ethereum core, it can also result in a more complex protocol. “Protocol complexity is a systemic risk, and adding too many features in-protocol increases that risk,” he said.
He provided an example of how the implementation of Precompiles on the Ethereum blockchain has fallen short of expected usefulness over the years. Precompiles are contracts implemented on the Ethereum blockchain via client code, instead of EVM smart contract code.
EVM (Ethereum Virtual Machine) smart contract code, on the other hand, is the code that defines the behavior of smart contracts on the Ethereum blockchain. EVM smart contract code is written in Solidity or other programming languages that can be compiled into bytecode
Unpredictable user needs
Vitalik also added that the reason behind treading cautiously on the Ethereum core is that enshrined features may not align with users’ actual needs, which can change over time, potentially becoming underutilized.
Vitalik suggested a middle road, where the protocol enshrines specific pieces to address key challenges without being overly opinionated.
“Rather than enshrining a full liquid staking system, enshrine changing staking penalty rules to make trustless liquid staking more viable; rather than enshrining more precompiles, enshrine EVM-MAX and/or SIMD to make a wider class of operations simpler to implement efficiently; and rather than enshrining the whole concept of rollups, we could simply enshrine EVM verification.”
Ultimately, he said that the debate over what to enshrine in the protocol and what to leave to other layers will continue to evolve as the blockchain ecosystem advances and user needs become clearer.