EIP-4850 and EIP-7691 spark protocol efficiency and value capture as ETH climbs; liquidations hit $221M
According to a new chart report from Matrixport, Ethereum's over 60% price rally can be largely attributed to Vitalik Buterin’s vision of simplifying Ethereum’s architecture into a more Bitcoin-like model, as the Pectra upgrade continues to gain traction. But while the performance of ETH is undeniably strong, Matrixport warns there are underlying variables worth monitoring.
Key Takeaways:
Vitalik Buterin is guiding Ethereum Layer 1 toward a simplified architecture, emphasizing security and clarity
ETH has risen over 60%, partially driven by protocol simplification and EIPs
EIP-4850 introduces revenue-sharing between Ethereum and Layer 2s
EIP-7691 reduces L2 transaction fees by increasing blob capacity
Ethereum liquidations spiked to $221 million, an unusual event during a rally
Vitalik's Simplified Vision for Ethereum
On May 3, 2025, Ethereum co-founder Vitalik Buterin proposed a restructured Layer 1 model focused on minimalism, enhanced security, and long-term scalability. This shift mimics Bitcoin’s leaner architecture, aiming to reduce technical complexity while improving reliability.
Vitalik’s proposals include:
Protocol simplification
Reduction of redundant computation at the base layer
Improved synergy with Layer 2 solutions
The Impact of EIP-4850 and EIP-7691
Two key Ethereum Improvement Proposals (EIPs) are playing a critical role in boosting the ecosystem’s utility and investor confidence:
🔸 EIP-4850
Implements a revenue-sharing mechanism with Layer 2 networks
Helps Ethereum retain economic value from off-chain activity
🔸 EIP-7691
Expands data block capacity (blobs) to lower Layer 2 fees
Encourages more transactions to return to Ethereum mainnet
Improves on-chain efficiency and throughput
These upgrades make Ethereum more attractive to both developers and institutional investors, supporting its bullish price action.
