Vitalik Buterin unveils Layer 2 plan for Ethereum amid price concerns
Ethereum’s Vitalik Buterin proposes multi-proof layer 2 upgrade
Ethereum co-founder Vitalik Buterin has proposed a new multi-proof framework aimed at enhancing the security, scalability, and finality of Layer 2 solutions.
The announcement comes amid continued price volatility and growing concern over liquidation risks within the Ethereum ecosystem.
Speaking at a recent forum, Buterin emphasized that the “multi-proof model” will integrate optimistic proofs, zero-knowledge (ZK) proofs, and trusted execution environments (TEE), with finality achieved when two of the three agree. This diversification, he noted, reduces reliance on a single fraud-proof method and enhances systemic resilience.
Stage 2 rollups and scaling benefits
A central element of Buterin’s roadmap is the introduction of “Stage 2 rollups,” designed to offer faster transaction confirmations and greater fault tolerance in semi-trusted settings. These improvements could allow Ethereum to scale transaction throughput while preserving its decentralized architecture. The shift marks a strategic evolution in Ethereum’s long-term Layer 2 vision, which seeks to mitigate costs and congestion without sacrificing security.
Liquidation risks on MakerDAO highlight structural fragility
While the proposal signals technical progress, it also underscores financial fragility in Ethereum’s broader DeFi ecosystem. Over 125,600 ETH—valued at roughly $238 million—are currently held as collateral on MakerDAO by major whale addresses. As Ethereum’s price remains volatile, with liquidation thresholds around $1,805 and $1,787, a deeper dip could trigger mass liquidations.
At press time, the health rate of these positions stands precariously at 1.07. If forced liquidations were to occur, the fallout could ripple across decentralized finance platforms and exacerbate market instability.
As Ethereum evolves toward greater scalability and security, the network must also address underlying financial vulnerabilities. Buterin’s Layer 2 blueprint could pave the way for a more resilient infrastructure, but the real test lies in how the network withstands systemic shocks.
Read also: Cardano price consolidates near $0.70 as technical indicators signal imminent move
