After the successful Paris upgrade, Tezos-based layer-2 (L2) scaling solutions are poised to achieve a throughput of millions of transactions per second (TPS).
Paris, the 16th upgrade of the Tezos protocol, was launched on the mainnet on June 5 with the goal of enhancing the network’s speed and scalability.
A key objective of the upgrade and Tezos’ scalability roadmap was to keep transaction fees low on the Ethereum Virtual Machine-compatible L2 network Etherlink even during periods of high network activity.
Following the upgrade, Etherlink now offers lower costs compared to Arbitrum and Optimism, along with an improved user experience (UX), as stated by Arthur Breitman, the co-founder of Tezos. He mentioned to Cointelegraph:
“Etherlink boasts a transaction finality time of 500 milliseconds, with data being posted on the main L1 in around 10 seconds. This is a significant improvement compared to two minutes on Optimism and seven minutes on Arbitrum One.”
Despite the discrepancy in finality times, Arbitrum One and Optimism remain two of the largest Ethereum L2 solutions by total value locked (TVL), with Arbitrum One holding $19.2 billion and Optimism holding $7.8 billion in TVL, according to L2Beat.
Tezos’ newly introduced Data Availability Layer (DAL) is the standout feature of the upgrade, designed to encourage more decentralized network participation by reducing hardware and bandwidth costs.
The addition of DAL will enable Tezos’ Smart Rollups to scale to handle millions of TPS in the future. Breitman revealed that Tezos rollups achieved 1 million TPS in a public demonstration in July 2023 through horizontal scaling.
In addition to boosting throughput, the Paris upgrade also reduced block times from 15 to 10 seconds to enhance transaction finality and decrease latencies during transactions. Quicker payment confirmations can enhance user experience across decentralized applications (DApps) built on Tezos.
This improved finality has significantly decreased payment latency, according to Breitman.
Finding a balance between faster transaction times, decentralization, and security is a major challenge in the cryptocurrency industry, known as the blockchain trilemma.