2023 Blockchain Technology Development Trends Outlook

Five Major Technology Hotspots

1. Ethereum's main technical upgrades ( Shanghai, Cancun )
2. Staking-related technologies and product services
3. Modular Blockchain Optimization and Application of Proprietary Rollup and Other Ecological Development
4. The application of zero-knowledge proofs in non-scaling areas
5. Account abstraction + multi-party computation, Lightning Network and other terminal application iterations

Ethereum Important Infrastructure Upgrade

The Shanghai upgrade will open up withdrawal functions, which is expected to increase staking volume and intensify competition among staking projects.

The Cancun upgrade is the most significant technical upgrade for Ethereum in 2023, mainly including:

• Proto-Danksharding: Reduce mainnet transaction fees and significantly improve performance.
• EVM Object Format: Optimize smart contract performance, reduce overhead

Preparation for Future Technological Development of Ethereum

• The KZG Ceremony started in January, laying the foundation for Proto-danksharding.
• Establish Danksharding standards to address technical barriers.
• Danksharding successfully marks the successful expansion of Ethereum.

Important Issues of Ethereum

• MEV related: decentralized builders, cross-chain MEV platforms, etc.
• Regulation and anti-censorship: crList prevents relaying malfeasance, protocol layer PBS achieves separation

Staking Track Development Direction

• Liquid Staking: Improve the liquidity of staked tokens
• Decentralized Staking: Needs to address the issue of insufficient liquidity.
• Re-staking: Innovative but may affect protocol security
• Decentralized Validator Network: A crucial step towards decentralized staking
• Staking yield stabilization: addressing the issue of excessive yield disparity

Ethereum Multiple Version Clients

• Paradigm's Reth: modular design, easy for development
• Helios of al6z: Coupling of execution layer and consensus layer, effects to be observed.
• Self-hosted Blockchain Explorer: Solving Centralization Issues

Modular Blockchain Technology Development

New competitors in the data availability layer:

• More participants like Polygon Avail
• Adopt a compromise approach like Arbitrum AnyTrust
• Based on re-staking technology like EigenDA

Execution Layer Optimization:

• Fuel uses UTXO and a parallel virtual machine to improve efficiency.
• Rooch and other flexible execution layer networks

Layer2 Optimization Plan

• Modular Rollup: AltLayer, etc.
• Quickly build Layer2: OP Stack and so on
• Application-specific Rollup: Stackr, dymension, etc.

Solve Sequencer Centralization:

• Shared Sequencer: Espresso, OP Stack, etc.
• Decentralized Sequencer Design

Development of Layer2 and Layer3

• More Layer2 "subnet" and ecosystem competition
• Layer3 enables further vertical scaling
• Worth paying attention to: Avalanche Subnet, Binance Sidechain, Shiba, etc.

zkEVM Development

• Multiple projects have launched on the mainnet
• The technology maturity takes time, especially EVM compatibility.
• ASIC hardware supporting zkEVM is expected to appear by the end of the year.

Zero-Knowledge Proof Applications

zkBridge becomes a hot topic:

• Verify signatures on lightweight clients
• Zero-knowledge consensus process

Cross-chain Development Trends

• Increasing multi-chain applications: identity verification, liquidity sharing, etc.
• Cross-chain MEV Development
• Inter-chain security solutions: Cosmos shared security, etc.

Wallet and User Application

• MPC becomes standard configuration, supporting more scenarios
• Account abstraction ( EIP43370 1928374656574839201 is nearing completion
• Development of Lightning Network Applications: Payments, Financial Services, etc.
• Layer2 Payment Solution Improvement

![Top 5 Technology Trends to Watch in 2023: Ethereum Upgrade, Staking, Modularization, ZK Applications, and Account Abstraction])https://img-cdn.gateio.im/webp-social/moments-dcea6318341ad38eca52eb0558d4c574.webp(

Improvement of Web3 Development Tools

• Development of the Move language ecosystem
• The Layer 2 development environment is完善
• New tool accumulation: low-code, data middleware, endpoint services, etc.

![Top 5 Technology Trends to Watch in 2023: Ethereum Upgrades, Staking, Modularization, ZK Applications, and Account Abstraction])https://img-cdn.gateio.im/webp-social/moments-37231e595b04f567b53b994b31905426.webp(

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