Bank of America: Ethereum won’t remain dominant if it doesn’t scale

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As the so-called “Merge” approaches, during which the Ethereum blockchain will transition from proof-of-work to proof-of-stake, Bank of America has released a research report delving into the matter.

In it, the bank noted how Ethereum had lost market share to other blockchains like Solana and Binance Smart Chain due to its inherent scaling limitations. It noted that, without the proposed scaling solutions set to follow the Merge, Ethereum is unlikely to remain a dominant blockchain.

Will the Merge help Ethereum scale?

It’s important to note that the repeatedly-delayed Merge is not a scaling solution at all. Instead, it will combine Ethereum’s execution layer with a proof-of-stake consensus layer called the Beacon Chain. This will still leave Ethereum capable of only 20 transactions per second or thereabouts.

The proposed scaling solutions following the Merge are known as the Surge. Allegedly, when complete, these changes will allow Ethereum to process 100,000 transactions per second. This will also supposedly improve Ethereum’s notoriously unpredictable and expensive gas fees. 

“At the end of this roadmap, Ethereum will be a much more scalable system. By the end, Ethereum will be able to process 100,000 transactions per second,” Buterin said at the recent Ethereum Community Conference in Paris. 

Seriously, that’s it?

The BoA report rightly recognizes that Ethereum is losing credibility, developers are leaving en masse, and it won’t have a future outside of being a hobby blockchain if it doesn’t deliver on its scaling promises.

With that said, it boggles the mind that 100,000 transactions per second is the aim at the end of all of this. For context, Bitcoin SV can deliver this in its infancy, and that’s before Teranode. Dr. Craig Wright has repeatedly said that millions, billions, and eventually trillions of transactions per second are needed so that Bitcoin can act as a base layer for the Internet of Things (IoT) and serve as a purely peer-to-peer global network fueled by micropayments.

Yet, digital currency outlets still fawn over Buterin as if he’s some sort of tech god, when in reality, he’s hoping to someday be able to deliver what Dr. Wright and BSV consider a warm-up lap. What gives?

Scale or die—Bank of America knows the truth

The key takeaway from the Bank of America report is that Ethereum won’t survive in any meaningful sense if it doesn’t fix its scaling issues. It aims to do so via proposed future solutions because Buterin and his team know all too well that it will never and can never scale as it is and that there are built-in limitations to Ethereum.

The truth is that while this report focuses on Ethereum, no blockchain will survive unless it scales massively. That’s because, after the nonsensical narratives that have characterized “crypto” for the last few years were exposed during the carnage of the recent crash, it’s beginning to dawn on everyone that they’d better start delivering some real value if they want to keep the dollars flowing. This is something those involved in Bitcoin SV have known and aimed for from the start. Unlike other blockchains, BSV never hits a scaling ceiling, just as Satoshi Nakamoto said.

The existing Visa credit card network processes about 15 million Internet purchases per day worldwide. Bitcoin can already scale much larger than that with existing hardware for a fraction of the cost. It never really hits a scale ceiling. – Satoshi Nakamoto to Mike Hearn, April 2009

Truthfully, Ethereum can merge, surge, verge, purge, and splurge all it wants. It will never be able to catch BSV, and so just as BoA predicts, it will lose its dominant position as a blockchain. History has proven that developers shouldn’t believe a word Buterin and his team says, but even if they deliver, it won’t be enough. It’s time to consider alternatives.

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