The L1 Weekly Report is published every Friday, focusing on the development of Layer 1 blockchains. If you have any suggestions, feel free to contact [email protected].

BTC

• How Does the Lightning Network Address Potential Issues in Standard HTLC Protocol
  • The Lightning Network addresses potential issues in the standard HTLC protocol by ensuring that both parties contribute to the fees and that the process is atomic, preventing one party from forcing the other to incur fees without cooperation. HTLC transactions are not broadcast until both parties have signed a commitment transaction, ensuring atomicity in payments. In case of conflicts, the most recent commitment transaction, which includes the last HTLC, is what would be broadcast, allowing for the resolution of disputes without incurring unnecessary fees.
• How to add a custom struct to PSBT and handle transaction fees using BIP-174
  • In Bitcoin transactions using BIP-174, the second party can add a custom structure to the PSBT, while the first party, as the sole provider of funds, will pay all transaction fees.
    The Bitcoin blockchain does not support automatic fee splitting, but both parties can manually adjust the fee distribution by controlling the transaction’s inputs and outputs.
    BIP-370 (PSBT v2) improves upon BIP-174 (PSBT v0) by adding more features, such as the ability to add more inputs and outputs, whereas BIP-68 is not about output tagging but rather about time lock.

Ethereum

Recently, Vitalik has published a series of 4 blog posts exploring the future of Ethereum, focusing on its future positioning and the challenges and solutions associated with the upgrade of Ethereum’s consensus mechanisms.

• Practical endgame on issuance policy
  • The article discusses a practical endgame for Ethereum’s issuance policy, proposing reward curves that cap the growth of staked ETH while maintaining positive incentives for small solo stakers. It suggests a maximum issuance rate of 0.5% within a framework that balances ETH supply, demand, and protocol revenue. The post also raises questions for the community on acceptable staking yields and the desirability of a fixed issuance rate, emphasizing the need for a viable endgame that can adapt to future changes such as MEV burn mechanisms.
• Possible futures of the Ethereum protocol, part 3: The Scourge
  • The article discusses the risks of centralization in Ethereum’s proof-of-stake mechanism due to economic pressures and proposes solutions to minimize these risks. It explores strategies such as two-tiered staking models and reducing issuance to cap the percentage of ETH staked. The goal is to maintain a decentralized and secure Ethereum network while addressing challenges like MEV extraction and the potential for value extraction by a small group of large stakeholders.
• Possible futures of the Ethereum protocol, part 4: The Verge
  • The article discusses the future of Ethereum’s verification mechanism, aiming to make it more accessible and efficient. It explores options like Verkle trees and STARKs for stateless verification, and the potential for full blockchain verification even on devices like smartwatches. The Verge’s goals include reducing the storage requirements for nodes and enabling secure and efficient validation of Ethereum’s blockchain, aligning with broader efforts to enhance Ethereum’s scalability and decentralization.

Solana

• State of Solana Breakpoint 2024 Report
  • Solana’s ecosystem is experiencing rapid institutional adoption with upcoming launches from major financial institutions, and mobile development is growing with new apps and devices. The Solana payments ecosystem is expanding with cross-border payment apps and new stablecoins, and decentralized energy is emerging as a significant DeFi sub-sector. Despite a recent decline in on-chain activity, Solana’s market share of transaction fees grew until July, and the network continues to see increased development activity and fundraising.

Aptos

• 2 Years of Aptos: Celebrating Network & Ecosystem Mainnet Growth
  • Aptos has achieved 27.7 million active addresses and 1.7 billion transactions within two years of its mainnet launch, setting new benchmarks for blockchain performance. The network’s ecosystem has expanded significantly, with a 5x increase in Total Value Locked and over $150 million in funding from the Aptos Foundation supporting over 165 projects. As Aptos enters its third year, it aims to further enhance its position as a leader in digital finance by focusing on payments, DeFi, and global financial transactions, with the infrastructure to handle the next trillion-dollar economy.

TON

• TON Memelandia Launches $1.25M Memecoin Battles
  • TON Memelandia has launched two memecoin competitions with a total prize pool of $1.25 million to support memecoin growth and attract participants to the TON ecosystem. The competitions, Cabal Arena and Memecoin Mountain, will last for four weeks and involve trading battles, community engagement, and performance metrics to distribute the rewards. The events aim to boost the TON ecosystem’s trading volume, liquidity, and support the launch of new memecoins while fostering community growth.