Ethereum (ETH) has long been criticized for its limited scalability. However, the situation has improved significantly with multiple updates, and recent milestones demonstrate the network’s increased processing capabilities.
Ethereum network reaches new speeds
The Ethereum ecosystem, comprising the base network and other faster networks built on top, has set a record. According to L2Beat, a dates analysis platform, the number of transactions per second (TPS) reached 246.18 yesterday, translating to approximately 21.2 million transactions per day.
Xai, a new network built on Ethereum, contributed significantly, with over 41% of TPS, primarily serving the gaming industry. Xai’s transaction processing increased from around one per day before June 10 to a peak of 101.72 TPS on June 16.
Other top contributors included Coinbase’s Base network and Arbitrum (ARB), which contributed 33 and 21 TPS, respectively, on June 16, making them among the largest contributors.
What does this milestone mean?
While the Xai network’s high TPS is impressive, the total value locked (TVL) on the platform remains limited, at $1.38 million. This suggests that the high transaction rate involves relatively small amounts. In contrast, Base and Arbitrum have much larger TVLs.
Steven Goldfeder of Offchain Labs argues that TPS is an overestimated benchmark for measuring blockchain performance, comparable to counting the number of bills in a wallet without considering their value.
Analysts optimistic
Despite Ethereum’s recent decline, analysts remain optimistic about its future. The US Securities and Exchange Commission (SEC) recently approved Spot ethereum exchange-traded funds (ETFs), which could attract a significant investment of $4 billion.
Analysts predict an upward trend with the expected launch of the ETFs in July, potentially leading to significant price increases due to increasing investor interest and decreasing supply.