Ethereum, for many, represents a major settlement layer on the internet of value. The network is still front and center for Web3 development and innovation. But it has problems with scaling, throughput, and high gas costs that make it hard to use.

Hemi is built to outscale Ethereum with a decentralized multi-node consensus model that inherits Bitcoin’s security and maintains EVM compatibility. While Hemi out-revs both Bitcoin and Ethereum, it also supports tunnels that maintain asset composability between the two ecosystems without yielding to centralized processes.

Why Ethereum Stalls

Ethereum is not currently scaling effectively because the network’s infrastructure is limited by its design, which prioritizes decentralization and security over scalability. The Ethereum mainnet processes all transactions on a single layer, leading to congestion during periods of high demand. This congestion results in slower transactions and higher fees. While solutions like rollups, sidechains, and the upcoming Ethereum 2.0 upgrade aim to address these issues, they introduce trade-offs and are still in development or early stages of adoption. The network’s reliance on these complex and evolving solutions has slowed down its ability to scale efficiently in the short term.

Ethereum has been exploring various solutions to improve transaction speed and reduce fees, with each approach offering different trade-offs. Here are the main solutions and the compromises they introduce:

Optimistic Rollups: Optimistic rollups batch transactions and publish them to the Ethereum mainnet (L1) after executing them off-chain. These batches are assumed to be valid unless someone challenges them within a seven-day window. This method reduces fees and increases speed, but it introduces significant delays. Users must wait for the challenge period to end before transactions fully settle on the mainnet. Additionally, the responsibility for detecting fraud falls on the users. Today’s optimistic rollups also rely on centralized sequencers and proposers, which can lead to issues with transparency and trust, as the mempools (queues of pending transactions) are not fully transparent.

Zero-knowledge (zk) Rollups: Zk rollups also bundle transactions and validate them before posting a cryptographic proof to the L1, proving that the execution state is correct. This method ensures that the state committed to the L1 is accurate, without the need for a challenge period. However, similar to optimistic rollups, zk rollups currently depend on centralized sequencers with opaque mempools and centralized proposers. This centralization can be a point of concern for users who prioritize decentralization and transparency.

Validiums: Validiums operate similarly to zk rollups but only publish state roots to the L1. The network itself is responsible for ensuring that chain data is available to users for settlement back to the L1. This reduces the load on the Ethereum mainnet and improves scalability. However, the compromise here is that the burden of ensuring data availability falls on the network. If the network fails to maintain transparency, users might face difficulties in verifying the state or recovering assets.

Sidechains: Sidechains are independent blockchains connected to the Ethereum mainnet via a bridge. They maintain their own consensus mechanisms and handle transactions separately from Ethereum. Sidechains can offer faster and cheaper transactions, but they come with significant trade-offs in terms of security. Since they rely on a separate consensus mechanism, they may be less secure than Ethereum’s mainnet. Additionally, the bridges connecting sidechains to the mainnet can be vulnerable to attacks, putting cross-chain transactions at risk.

Each of these solutions offers improvements in transaction speed and cost, but they also introduce new challenges, particularly around security, centralization, and user trust. Balancing these factors is key to the ongoing development of Ethereum’s scalability solutions.

How Hemi Solves Scaling

Hemi Network scales Ethereum by integrating it with Bitcoin in a modular protocol that enhances scalability, security, and interoperability. Hemi introduces a unique approach by treating Bitcoin and Ethereum as components of a unified supernetwork rather than separate entities. This integration is achieved through the Hemi Bitcoin EVM (hVM), which encapsulates a full Bitcoin node within the Ethereum Virtual Machine. Hemi’s decentralized rollup mechanics allow for decentralized publication of state roots to Ethereum, overcoming the limitations of centralized sequencers in current rollups. Additionally, Hemi uses its Proof-of-Proof (PoP) consensus mechanism to inherit Bitcoin’s security, making the network more robust. By combining Bitcoin’s Proof-of-Work security with decentralized sequencing, Hemi provides a scalable solution that accelerates settlement while maintaining security. This architecture enables a higher transaction throughput on Ethereum without compromising on security or decentralization, effectively scaling Ethereum by leveraging Bitcoin’s security and combining it with advanced interoperability features.

Ultimately, Hemi helps Ethereum and Bitcoin scale in ways that the singular blockchains alone cannot, adding further utility to both blockchains and improving both immeasurably.

To learn more about how Hemi integrates Ethereum programmability and Bitcoin’s security to out-scale both networks, read the whitepaper and the relevant documentation or stop by the team’s Discord.