Ethereum Sets New Transaction Per Second (TPS) Record
The Ethereum network, along with its Layer 2 (L2) ecosystem, has reached an unprecedented milestone by hitting 32,950 transactions per second (TPS). This achievement exceeds last week’s 31,000 TPS record and highlights Ethereum’s advancements in scalability and efficiency.
The Role of the Fusaka Upgrade
The Fusaka upgrade, launching today, promises to revolutionize Ethereum’s functionality. Thanks to this update, node operators will now only store one-eighth of the data blobs they previously handled. This adjustment not only reduces operational costs but also boosts network efficiency, paving the way for a more streamlined blockchain experience.
A significant contributor to Ethereum’s recent TPS surge is the Ethereum-based perpetual exchange, Lighter. By leveraging zero-knowledge rollup technology, Lighter efficiently processes thousands of transactions with minimal cost. The popularity of zero-knowledge systems continues to grow, propelled by endorsements from Ethereum’s founder, Vitalik Buterin. Such innovations confirm that Layer 2 networks are critical to Ethereum’s scaling strategy.
Layer 2 Networks and Economic Shifts
Before Fusaka, Layer 2 networks relied on Ethereum for security but contributed meager fees, resulting in minimal ETH burns. Fusaka implements groundbreaking rules ensuring every Layer 2 transaction directly impacts ETH burn rates. With this setup, Ethereum is expected to shift towards deflation, potentially burning an additional 200,000 to 400,000 ETH per year.
Currently, Ethereum’s annual issuance is around 620,000 ETH, while 350,000 ETH is burned. As L2 adoption grows post-Fusaka, Ethereum is better positioned for economic sustainability and long-term value appreciation.
ETH Market Performance
Ethereum’s price hovers around $3,082, surpassing its 7-day simple moving average (SMA) of $2,979 and breaking the critical $3,000 psychological level. The daily trading range has fluctuated between $2,976 and $3,141. Analysts indicate that holding above the $3,080 mark could push Ethereum toward the $3,269 level, aligning with the 50% Fibonacci retracement zone.
What Does This Mean for the Wider Crypto Market?
This bullish sentiment is not isolated to Ethereum. The total cryptocurrency market capitalization has risen to $3.13 trillion, showcasing improved investor confidence. Bitcoin has also entered the green zone, aligning with broader market trends.
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