Ethereum can theoretically beat Visa in terms of TPS after Istanbul upgrade
Ethereum can theoretically beat Visa in the number of transactions per second, post the Istanbul upgrade. In a study concluded by blockchain identity management solution, iden3, Ethereum after Istanbul upgrade can reach a max TPS of 2048 using ZkRollup. This is more than Visa’s current 2,000 TPS.
Istanbul upgrade which went live in the first week of December 2019 introduces two new EIP (Ethereum Improvement proposals) – EIP-1108 and EIP-2028. EIP-1108 introduces cheaper zk-SNARKs pricing, and EIP-2028 lowered the gas cost of call data from 68 gas per byte to around 16 gas per byte.
According to research by iden3, using zkRollup Ethereum’s transaction can reach 2048 TPS theoretically. Practically, things are not as simple. A 2048 TPS throughput would require fitting 15 batches into a single block and would entail a batch creation time of just one second (assuming 15 second block times). The iden3 team also spoke of how each zkRollup batch requires a short cryptographic proof (zk-SNARK) that proves the integrity of the transactions in that batch.
Generating this proof is computationally very expensive, adding that it is a major bottleneck to achieving the theoretical throughput limit. Setting up servers capable of handling over 2000 transactions a second is a major issue. According to the analysis, an advanced block explorer would be required just to handle all the information.
What is zkRollup?
zkRollup is a Layer 2 scaling solution similar to plasma. What differentiates zkRollup from Plasma is that it solves Plasma’s huge problem — data availability — by publishing some data for each transaction via the L1 network (main Ethereum chain). Thousands of transactions can thus be bundled up (rolled up) together in a single Rollup block.
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