Ethereum: the Unicorn in the Room is the lack of adoption

Despite the collapse of prices both in terms of dollars and bitcoin value, 2019 was a year of profound evolution for Ethereum. With the latest two updates (aka “Fork”), Constantinople and Istanbul have integrated technologies based on the zk-proof concept that are making an important step forward in the issue of scalability, while keeping the paradigms of security and decentralization intact.

From now until March the first Dapps will show up, allowing an increase of TPS by at least an order of magnitude, from about 20 tx/sec to 150–300 tx/sec, with the promise to scale by a further 10x by the end of the year.

In addition to zk-proof, other technologies linked to scaling issue have already seen the light or will see it soon, namely those related to sidechains (Plasma above all) and payment/state channels.

I’d like to make a rather strong statement:

In term of research and development, Ethereum has already solved the problem of scalability of the blockchain keeping intact decentralization and security.

I’m talking about the current development line of Ethereum, the one that leads from 1.0 to 1.x, without bothering the revolution premised by Ethereum 2.0.

But obviously something has not gone in the right direction because the usage of Ethereum is not increasing at all, on the contrary there are several on-chain indicators that indicate a stagnation in terms of adoption.

From Bitinfocharts:

The most significant of the above graphs in terms of (missed) adoption, is the first, which shows the weekly moving average of the number of active daily addresses on the blockchain.

Definitely not a growth trend.

The scalability of Ethereum therefore doesn’t seem to be a problem to solve, since the market demand for transactions even at a negligible price remains low and well below the capacity of the blockchain (10m of gas per block, when I’m writing).

The problem to be addressed as a priority is the reduction of the friction in using Ethereum and specifically the management of private keys, or in other words: the methods, interfaces and ancillary services for the creation, management and possible recovery of accounts or new methods of iteration with the blockchain.

Ideally people should be able to have all the benefits of using Ethereum without “almost” realizing they are using a blockchain.

I don’t think dealing with this problem is more difficult than solving the scalability issue, which has been done as I said before. I think instead that for experience and culture, the “core” developers of Ethereum and its ecosystem (as of all the blockchains) are led to discuss, think and solve technical and mechanical social issues, rather than design a simpler user experience for the average — or even below average — users.

If we look at the huge Ethereum ecosystem we notice very few Companies that focus on providing users with easy access to the blockchain and simple management of its potential:

Argent

Wallet Connect

Universal Login

Lite.im

Burner Wallet

I apologize in advance for any product I didn’t mention, but honestly I can’t recall many other projects which are focused on the easy access and management of the blockchain.

The Ethereum Foundation has offered and continues to offer significant grants for the development of the ecosystem. Among the topics that can be funded we can see (from https://blog.ethereum.org/2019/11/19/Ecosystem-Support-Program-call-for-applications/):

……

Explorations of the security-usability tradeoff space for cryptoassets.

For example, social recovery mechanisms for wallets, or rules that vary depending on asset type / value / other attributes

…..

I may be wrong but there are no grants for projects that specifically concern the reduction of the friction in using the blockchain, and it seems to me that “usability and adoption” are NOT main topics in Ethereum public events nor in discussions inside the Ethereum Foundation.

I can only hope for a greater attention to those issues, because I see a huge unexpressed potential due to a bottleneck related to design and iteration interfaces with the blockchain, which are still too complex for common people.

I realize how important is to maintain high standards of security and decentralization, nevertheless I think that as well as a brilliant work has been done to solve the problems related to scaling, an equal effort can and should be made to bring the masses to use the blockchain, with simplicity and without anxiety.

Author: Paolo Rebuffo, CTO Deepit AG

“The future is already here, we make it accessible”. We support companies in their approach to the world of blockchain. https://www.deepit.ch/

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