L1 Wars: $ETH vs $AVAX

The blockchain scalability debate

Nov 22, 2021

Welcome to the ninth Alpha newsletter. We curate alpha for you. That’s it; that’s the newsletter.

Two households, both alike in dignity,
In fair CT, where we lay our scene
From ancient grudge break to new mutiny,
Where civil blood makes civil hands unclean.

There was plenty of intense debate this weekend regarding Ethereum and Avalanche.

This Alpha update looks to provide a few opinions from both sides, as well as some useful resources regarding blockchain education and scaleability towards the end of the newsletter. Strap in.

3AC in the firing line

Alpha is aware of proceeding tweets which Zhu Su from 3AC responded to, but we want to focus on the technical debate. It’s probably fair to say Zhu kicked off the wider discussion with a strong attack on Ethereum. 🔺 = support for Avalanche.

Zhu Su 🔺 @zhusu

Yes I have abandoned Ethereum despite supporting it in the past. Yes Ethereum has abandoned its users despite supporting them in the past. The idea of sitting around jerking off watching the burn and concocting purity tests, while zero newcomers can afford the chain, is gross.

Zhu Su 🔺 @zhusu

Ethereum culture suffers massively from the Founders Dilemma. Everyone is already far too rich to remember what they originally set out to do. Perhaps a bear market is needed to remind them, or perhaps we must build elsewhere, but this is what it is--nothing new under the sun.

Zhu Su 🔺 @zhusu

Reason why prev tweet has 4k likes in 1hr is bc users are livid that they're promised a vision of the future, then told that they have to pay $100-1k per tx to enjoy it, and then get told some tales about how they should've been smart enough to buy ETH at $10.

Cue the developer response to the VC.

ً @lightclients

Zhu, you are very disconnected from what is actually happening at the protocol. There is no “Founders Dilemma” - only really smart people working on hard problems while trying to safely upgrade a $500 billion chain.

Zhu Su 🔺 @zhusu

ً @lightclients

Essentially the entire core go-ethereum team has worked tirelessly for 5-6 years and continues to sprint forward on the merge. Same with the core eth2 teams - same people, 2-4 years later, still working day in and day out to bring a secure proof-of-stake network to the world.

ً @lightclients

Imagine spending multiple years on what you think is the right path for Ethereum, only to discover a better path and then start over and work for 3 *more* years to do it right: EIP-1011: Hybrid Casper FFGEthereum Improvement Proposals (EIPs) describe standards for the Ethereum platform, including core protocol specifications, client APIs, and contract standards.eips.ethereum.org

Hudson Jameson @hudsonjameson

100% this. It's not like VCs are generally in the trenches working on protocol level code or even monitoring it for that matter so I'll dismiss Zhu's opinion. Fees are too high and I hate that it's pricing people out. The issue is our popularity grew faster than we could scale.

ً @lightclients

The founder of Uniswap has joined the chat.

hayden.eth 🦄 @haydenzadams

No issue w/ L1s that prioritize immediate scaling over decentralization, many users want this But this is a real bad take Incredibly insulting to everyone working on ETH 2.0 and L2s Especially from someone who has gained extraordinary wealth off the backs of Ethereum builders

Zhu Su 🔺 @zhusu

The founder of dYdX, one of the most successful ETH L2 dapps, cautiously agreed that Zhu had a point.

Antonio | dYdX 🦔 @AntonioMJuliano

[risky tweet of the day 🙈] This is said much harsher than I would put it, but I somewhat directionally agree Ethereum has not executed over the past few years. I can’t think of a single 10x useful improvement Ethereum has made in the past *4 years* 😕

Zhu Su 🔺 @zhusu

In amongst all of the debate there is probably a lesson here.

Liron Hayman @HaymanLiron

The different reactions to Antonio vs. Zhu really shows that it's not what you say, it's how you say it.

Marc from AAVE had a different take.

Marc "Crypto Scum" Zeller 👻 🦇🔊 @lemiscate

I love how ppl that "Abandoned Ethereum" mostly use and chill EVM networks. (Avax c-chain, BSC, FTM, harmony, polygon and so on what they are? Ethereum tech.) Ethereum is the standard.

Zhu Su 🔺 @zhusu

Marc "Crypto Scum" Zeller 👻 🦇🔊 @lemiscate

The truth hurt but in this debate no one really wrong. Ethereum is a victim of its own success and high gas fee on L1 is a feature of network security. But real ppl are priced out. So fortunately, other chains played right the quick and dirty hack of big block PoS system

Marc "Crypto Scum" Zeller 👻 🦇🔊 @lemiscate

The main difference is the timeframe. Ethereum L1 try hard to build to last "forever" Quick and dirty hack PoS is not sustainable and their chain grows exp and cost of having a node is exp too. After a few months of high usage this kind of stuff appear

BSC is a lost cause · Issue #553 · binance-chain/bscGuys, seriously, WTF. This is a blockchain with supposedly billions of value, yet it is governed and developed like the project of a stoned teenager. I've rarely seen something handled so unpro...github.com

Marc "Crypto Scum" Zeller 👻 🦇🔊 @lemiscate

Ethereum on their side don't have the luxury or choice to be a "disposable" transition chain. They have to be L2-centric but it takes time. Arbitrum is here today but with training wheels. Optimism is kinda here and also starkware proven their worth all just need a bit more time

Zhu follows up

Zhu admitted the emotions may have affected his choice of words and looked to clarify his earlier statements.

Zhu Su 🔺 @zhusu

Want to soften this and say abandon is the wrong word. Was heat of the moment. I'm sorry. There are great teams working on scaling Eth on L2. Would've preferred to see eth1x roadmap. Also would've preferred focusing on users rather than holders welfare in upgrades.

Zhu Su 🔺 @zhusu

Certain members of the ETH community weren’t too pleased with the “apology”.

SwagtimusPrime.eth 🦇🔊🐼 @FroggyFrogster

Zhu's apology isn't an apology at all. He's still claiming Ethereum upgrades are made to enrich holders. It's insulting, it's despicable, it's gross. Someone in this space for so long should know you can't just increase an L1's block size to scale.

Is Avalanche the answer?

Moving onto the topic of Avalanche, there is many who are of the opinion that Avax blocks will eventually run into the same problems that ETH is suffering from right now.

DCinvΞstor @iamDCinvestor

Ethereum hasn't "abandoned users" the entire ecosystem is working to scale it, and L2s will deliver capacity in the meantime, i encourage users to use whichever chains they wish, mindful of key differences but any sufficiently popular fee market chain will eventually hit load

PhABC @PhABCD

Avalanche blocks will be full as well It’s really no secret that all chains will eventually be full if they get adopted and anyone telling you otherwise is lying. https://t.co/Z1jh0o4eWh

PhABC @PhABCD

Ethereum blocks will be full. Solana blocks will be full. Arbitrum blocks will be full. Optimism blocks will be full. Polygon blocks willl be full. Starknet blocks will be full. No project is even remotely close to have the throughput needed to serve the world.

🚨 A NEW CHALLENGER HAS APPEARED 🚨

Emin Gün Sirer🔺 @el33th4xor

I keep hearing this: "but but but some day Avalanche will be as slow as Ethereum." No. Avalanche brought us the biggest breakthroughs in consensus and bridging. We will address lesser engineering problems without batting an eyelid.

PhABC @PhABCD

Avalanche blocks will be full as well It’s really no secret that all chains will eventually be full if they get adopted and anyone telling you otherwise is lying. https://t.co/Z1jh0o4eWh

And then the team lead of Ethereum joined the fight.

Péter Szilágyi (karalabe.eth) @peter_szilagyi

@el33th4xor I'm sorry our team whose code you use is unable to solve the lesser engineering problems. Unfortunately it seems we're just not good enough. Though then why use our code?

Avalanche’s co-founder was quick to show his respect, taking the diplomatic approach.

Emin Gün Sirer🔺 @el33th4xor

@peter_szilagyi Péter, my respect for you and your work is without equal, and both you and the world knows this very well. The EVM's scalability problems go far beyond what any relatively small team can solve on their own. They require a holistic approach.

Kevin, who helped build Avalanche, showed how you can come to your own conclusions regarding the layer 1’s decentralisation.

./kevinsekniqi 🔺 good vibes only @kevinsekniqi

1/ While I'm supportive of cryptographically secure L2s, the current L2 narrative is very confusing to me. It hinges on the misconception that only the Eth mainnet L1 is "decentralized". If you're concerned about decentralization ability of Avalanche, you can test yourself 👇

Tim from the Ethereum team quote tweeted an earlier Zhu tweet, who showed his support for EIP 1559, having just arguably criticised it.

Tim Beiko | timbeiko.eth 🍵 @TimBeiko

Lots of thoughts on the conversations this weekend, and while I think there is a charitable interpretation to some of the criticisms, let me start by saying it's pretty rich to criticize people for "jerking off and watching the burn" when well....

Zhu Su 🔺 @zhusu

ΞIP - 1559, ΞTH to 9551 $ETH

It’s important to note the respect for Avalanche’s consensus layer, but Tim questions whether they have an answer to the state related problems Ethereum is suffering from.

Tim Beiko | timbeiko.eth 🍵 @TimBeiko

@benczheng AIUI AVAX has genuine innovation at the consensus layer but basically still uses Geth for anything state related, which is where most of Ethereum's scaling woes come from. I also don't think they've submitted any noteworthy improvement back.

Last take on the subject. High $ETH gas fees are net positive for everyone?

DeFi Times @defitimes

Worried about the ETH price amidst all of the FUD? Well, the ETH price action tends to respond well to record breaking FUD. Refer back to the price from December 2019.

DCinvΞstor @iamDCinvestor

i shit you not, the last time ETH FUD was this bad was December 2019 i remember it like it was yesterday