Ethereum went live 10 years ago, bringing programmability and composability to a technological innovation sparked by the advent of Bitcoin in 2009.
But what does the future of Ethereum hold? It’s a loaded question that is incredibly difficult to answer given the complexity and decentralized nature of the world’s pioneering smart-contract blockchain protocol.
Cointelegraph recently traveled to EthCC in Cannes to speak to the brightest minds in the Ethereum community about its current state and the future of the protocol amid the rise of highly competitive next-generation layer-1 blockchains.
These conversations formed the backbone of Cointelegraph’s latest mini-documentary: “The Fight for Ethereum’s Soul.”
The documentary features several founders, CEOs and builders in the Ethereum ecosystem including Ethereum Foundation (EF) co-executive director Tomasz Stańczak, Polygon co-founder Sandeep Nailwal, Ethereum France president Jerome de Tychey, Figment co-founder and CEO Lorien Gabel, Dune Analytics co-founder and CEO Fredrik Haga, Polygon Labs CEO Marc Boiron, YAP Global co-founder and CEO Samantha Yap and Base head of product Tom Vieira.
The documentary was directed and produced by Cointelegraph’s head of multimedia Gareth Jenkinson, with senior producer Celine Tan.
A decade of dominance under threat
Ethereum has dramatically evolved over the past decade. The blockchain managed to execute a change in consensus algorithm, often likened to replacing the engine of a car driving at full speed on a highway.
The shift from proof-of-work to proof-of-stake fundamentally changed the way the protocol works. Ethereum parted ways with Bitcoin’s proof-of-work approach to consensus, rooted in computationally and energy-intensive hashing, to a skin-in-the-game system that requires validators to stake ETH tokens to maintain the network and reap rewards.
While Ethereum initially provided fantastic functionality, it eventually encountered the same problems as the preeminent cryptocurrency protocol. Its base layer chain simply could not serve the needs of the growing number of users, applications and services that set up on its network.
To enable the ability to process infinitely scalable transactions, the Ethereum community adopted a layer 2-centric approach to scaling. Execution, from transactions or asset creation, was shifted to a separate infrastructure layer. These layers use incredible advances in cryptography, like ZK-proofs, to submit trustless evidence of transactions and activity to Ethereum’s base layer.
Related: Ethereum turns 10: Here’s how its booms and busts shaped history
This brought scale, speed and cost reductions to layer 1, but an inevitable consequence was the fragmentation of liquidity and shifting incentives for validators. Fees dropped on the base layer, which remains a core incentive for Ethereum validators to maintain the network.
Meanwhile, the superior execution environments of layer 2s began to pull liquidity from Ethereum’s base layer. In 2024, grumblings of discontent began to surface.
Prominent voices called for the EF to intervene and propose changes to the protocol that ensured the value of ETH continues to rise while maintaining the advances in UX and UI that layer 2s had provided.
Changing of the guard
In 2025, the EF made significant changes to its organisational structure. Tomasz Stańczak and Hsiao-Wei Wang took up a dual role at the top of the Foundation, reporting to a braintrust led by Vitalik Buterin.
Pectra, Ethereum’s latest network upgrade, hit the mainnet in May. It was the most significant change to the protocol since the Merge in 2022.
Combining the Prague execution layer and Electra consensus layer hard forks, Pectra introduced 11 Ethereum Improvement Proposals (EIPs) to improve scalability, user experience and staking efficiency.
Pectra builds improvements made by the 2024 Dencun upgrade, which famously introduced Blobs through EIP 4844, known as proto-danksharding.
Blobs provided a new way for L2s to post transaction data on the L1. The impact was dramatic; L2 transaction fees dropped by 90%.
Related: Ethereum transaction volumes see year-high amid SEC staking drama
An unavoidable consequence of this upgrade was that L2s no longer paid huge fees to settle on Ethereum. According to Dune co-founder Fredrik Haga, this was a technological boon, but an economic drawback for L1 validators.
“The L2 situation is interesting because now 85% of transactions are on L2, so there’s only 15% left on Ethereum L1, but 85% of the volume still lives on L1,” Haga said. “The L1 has very limited engagement, if you will, in like the absolute number. But the big money is still clearly on L1. Then obviously the L2 used to pay a lot to settle to L1. And since blobs were introduced in March 2024, that has basically gone to zero.”
The…
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