Running an Ethereum L2 was historically very expensive, with L2s having to pay millions in data availability costs to the L1. However, the Dencun hardfork (EIP-4844) in March 2024 introduced blobs, an expansion of blockspace that allows L2s to post batched data cheaply to the L1. This blob space is significantly cheaper than L1 blockspace and plays a crucial role in Ethereum’s rollup-centric roadmap. Notably, Base’s expenses dropped from $9.34 million in Q1 2024 to $42k in Q3 2024 due to the implementation of blobs.
Although blobs have been a cost-effective solution for L2s, the increasing onchain activity during the current bull market is causing blobspace to become expensive once again. There are limits to blob usage, with fees being introduced when usage hits a certain threshold. This has led to a debate within the Ethereum community about the implications of L2s paying minimal expenses to the L1. The concern is that this could reduce the value accrued to ETH as an asset, prompting discussions about how to ensure value is returned to the L1.
One argument is that L2s may opt for cheaper data availability providers or delay posting data back to the L1 when blob markets become expensive. While this may benefit L2 operators in the short term, it raises questions about the long-term value accrual to Ethereum. Proponents of blobs argue that they will generate revenue in the future and contribute significantly to Ethereum’s growth. Ethereum researchers are actively exploring ways to adjust blob limits and fees to ensure a balance between benefiting L2 users and accruing value to ETH.
The debate surrounding blobs boils down to whether Ethereum should prioritize the average L2 user and Ethereum-aligned ecosystems, or focus on value accrual to ETH as an asset. Researchers believe that scaling blob space for the long term is crucial to prevent an exodus of users to cheaper chains, but this could impact the perception of ETH as an economic asset in the short run. As discussions continue, Ethereum must navigate the complexities of balancing the needs of various stakeholders and forecasting the potential outcomes of their decisions.
In conclusion, Ethereum is facing a challenging dilemma regarding blobs and how they impact value accrual to the network. While blobs have proven to be a cost-effective solution for L2s, there are concerns about their long-term implications for ETH as an asset. As Ethereum researchers continue to explore solutions to optimize blob space and ensure a balance between user benefits and value accrual to ETH, only time will tell which approach will prove to be the most effective in securing Ethereum’s future growth and sustainability.
