Vitalik’s Proposal: The ‘Three Transitions’ Essential for Ethereum’s Evolution

3 transitions

Ethereum (ETH) co-founder Vitalik Buterin published a new recommendation on his blog today. In it, Buterin pointed out that “three transitions” are essential for Ethereum to move from an experimental stage to a mature technical foundation that is easy for general users to use. He elaborated on each challenge and the path to resolution.

The three transitions are “L2 scaling transition (shift to rollup)”, “wallet security transition (shift to smart contract wallet)”, and “privacy transition (shift to privacy-respecting fund transfers)”. Thing.

Without these transitions, general adoption of Ethereum will not be achieved and users will continue to opt for centralized solutions, Buterin said.

In particular, he foresees that the relationship between blockchain and Ethereum users and addresses (1 user = 1 address) will change significantly with these three transitions. Many current Ethereum users share the same address over multiple L2 (Layer 2 solutions), which he said could lead to confusion in the future.

Source: Vitalik Buterin

For example, the Brave Wallet used by Buterin (pictured above) holds ETH in four locations. As the adoption of L2 expands in the future, it is expected that assets will become more scattered, and the work of selecting L2 at the time of payment at stores will become more and more complicated.

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keystore contract

One solution to this problem, Buterin, suggests using a “keystore contract”. Keystore contracts are a means of unifying address management between different L2s and smoothing transactions between networks. This makes it possible to reduce gas charges and improve privacy.

Source: Vitalik Buterin

Users have different addresses in each L2, but when withdrawing funds from these addresses they must present proof of their current (or very recent) payment public key to the keystore contract. By using ZK-SNARKs (zero-knowledge proofs) for this proof process, privacy can also be enhanced.

Furthermore, Buterin argues that wallets should be more than just a tool for asset protection, they should also be responsible for protecting personal data. This includes a ZK-SNARK-based ID system and social recovery through decentralized management of private keys.

Application support

Collectively, the “three transitions” are a guidepost for shaping the future of Ethereum. Buterin emphasizes the importance of the Ethereum community as a whole re-evaluating the current system so that ordinary users can understand and take advantage of these advanced concepts.

For example, Dapps (decentralized apps) will need to support the ERC-1271 standard, which uses smart contract wallets to provide off-chain (L2) signatures, Buterin said. Off-chain signing means that signatures for verifying blockchain transactions are performed outside the blockchain.

Buterin cites ENS CCIP (Cross-Chain Interoperability Protocol) as an example of a Dapp that supports ERC-1271. ENS CCIP is a protocol for extending the functionality of ENS (Ethereum Name Service) to L2, which allows ENS subdomains to be automatically verified on any L2.

The smart contract wallet we’re talking about here corresponds to the “ERC-4337” standard, or “account abstraction,” introduced on the Ethereum blockchain in March 2023. With the introduction of this standard, even traditional user wallets now allow program-based payments, such as subscription fee payments and automatic in-game payments.

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