CEO and Co-founder of FTX crypto exchange, Sam Bankman-Fried believes that even Ethereum 2.0 (ETH 2) is incapable of handling decentralized finance’s (DeFi) potential growth. Bankman wants to highlight that DeFi’s upcoming growth will require a network with scaling capabilities at the optimal level. He wants to stress that even the latest Ethereum 2.0, known for fixing the current Ethereum network’s scaling issues, will not be able to handle the growing industry of DeFi.
Bankman-Fried recently appeared in a podcast show hosted by cryptocurrency journalist Calmia Russo. He discussed in the show that Ethereum is actually hindering the growth of DeFi and the only way to fix this is by building DeFi on other networks:
Bankman believes that DeFi has the potential to be mainstream one day, hence blockchain networks need to amp up their scaling capabilities to support DeFi based apps on their networks. He believes that with DeFi’s booming rate, even ETH 2 won't be able to handle the scaling capabilities for DeFi.
Even though the second version of Ethereum is designed to scale up by a factor of 100 to 1000x. He adds “Not just 100 times faster than Ethereum, we need like a million times faster than Ethereum.”
During the recent DeFi boom, Ethereum-based DeFi apps heavily congested the Ethereum network. The network congestion caused Ethereum's gas fees to go up by more than $15.
Sam Bankman-Fried shares his own experience with Ethereum’s poor design saying that whenever he and his team decided to build something on Ethereum they had to take a step back because of exceeding the limitations of the conditions required on the blockchain by orders of magnitude.
Bankman further said that he has actually tested over more than 30 blockchains including Ethereum, before finalizing to build his DeFi project Serum on the Solana blockchain due to the speed and accuracy.
The podcast also had Solana’s CEO and founder Anatoly Yakovenko, who agreed to Bankman-Fried’s beliefs. Anatoly says Ethereum’s current version requires a hardware requirement of 15 transactions per second while Solana processes transaction speed upto 500 to 600 TPS.