L2 New Narrative? One article takes you to understand the inscription of Ethereum

On June 17th, Etherscripts, the Ethereum Inscription Protocol, was launched with a casting cost of approximately 0.5U for its text token $eths

On June 17th, Etherscripts, the Ethereum Inscription Protocol, was launched with a casting cost of approximately 0.5U for its text token $eths. Within a few days of casting, the off market price reached 100U, bringing a hundred fold profit to early participants. In early August, the price skyrocketed to 500U. Afterwards, as the price of $ordi continued to decrease, the popularity of $eths gradually faded, and the price fell back to around 300U. After more than two months of silence, on October 8th, $ETHS experienced an outbreak, with prices climbing to 800U, igniting the emotions of those who had not boarded the car.

In the official telegram group, community members are on standby at any time, commenting and forwarding under $ETHS related tweets to increase traffic and promote the dissemination of related tweets. At the same time, KOLs also view $eths as traffic passwords and publish related content about $eths, even casually mentioning the huge amount of interaction that $eths can attract. Under the promotion and discussion of community members and some KOLs, many bystanders who had not previously participated in Ethscripts also joined the massive discussion. But this is just the behavior of the buttocks determining the brain, and it cannot be a reason for our investment decisions.

Ethereum Inscription Concept

The Ethereum Inscription Protocol is similar to the Ordinals protocol on Bitcoin, allowing people to engrave different types of files on the Ethereum main network, as long as the size does not exceed 96KB. To be precise, this protocol is to annotate information (hexadecimal characters) on a transaction. As the transaction occurs on the chain, it is a complete on chain behavior, with information that cannot be tampered with, and shares ETH security.

The Etherscripts concept was proposed by Tom Lehman, co-founder and former CEO of Genius.com, and on June 17, 2023, search engines and websites were developed for the protocol.

Tom's original intention was to reduce the casting cost of NFTs through the Ethscripts protocol, thereby lowering the funding threshold required for casting NFTs and further promoting the popularization of NFTs. Afterwards, Tom Lehman and his team utilized the calldata field in ETH transactions to store unique reference identifiers and developed a smart contract protocol based on ETH inscriptions to achieve low transaction costs and fast functionality.

development history

On June 17th, Ethscripts was founded, and the first officially launched project was Ethereumpunks. After about 2 hours of launch, all of them were completed, and the current secondary floor price is 0.006E. Although Etherempunks is the first officially launched project, the market response is not strong. What truly makes Ethereum inscriptions popular is the $eths that bring eye-catching benefits.

On July 17th, the trading market Ethscriptions.com was attacked by hackers, resulting in the theft of a large number of inscriptions on its shelves. In this attack, approximately 123 addresses lost a total of approximately 202 inscriptions. Previously, $eths had already experienced a surge, with some inscriptions reaching a price of 5ETH. This vulnerability can be traced back to a smart contract created by two co founders, which contains a small piece of code that allows people to withdraw inscriptions that do not belong to them from the market. But then, this incident was resolved. The founder stated that they have contacted many users affected by the vulnerability.

On July 25th, founder Tom Lehman tweeted and announced the official launch of EtherscriptionsMarketplaceV2, launching a new protocol called ESIP-2 for the Ethereum subscription market. The launch of the new market has once again ignited the enthusiasm for trading Ethereum inscriptions. According to OpenSea data, the total transaction volume of Ethereum inscriptions has reached 655ETH so far.

On August 8th, ESCVM (Etherscripts Virtual Machine) tested online cables, taking Etherscripts to a new development trajectory. In the ESIP-4 proposal, the Ethereum inscription introduced virtual machines. This is a new protocol built on top of Ethscripts. ESCVM endows Etherscripts with computational capabilities. And Ethscripts also introduces a contract system called DumbContracts, which users can interact with through inscriptions.

On September 8th, Ethscripts officially announced $eths as their official token, and the inscription token can be split through the DumbContract bridge. $eths will become the pioneer of the official bridge Ethscripts token, and plans to launch a DumbContract DEX based on UniswapV2. Due to the increased separability of tokens and the consistency of DumbContract token standards with ERC-20, transaction convenience has been improved and transaction thresholds have been lowered.

On September 27th, DEXDumbSwap, based on a dummy contract, was launched for testing on the network.

On the evening of October 8th, the volume and price of $ETHS skyrocketed from around 300U to 800U, sparking widespread discussion.

On October 9th, Etherscripts completed the ESIP-5 upgrade, reducing the transfer gas fee to around 0.05U, which is even lower than some L2.

There are three stages in the development of Ethscripts:

• Stage 1: In this stage, $eths can be compared to $ordi;
• Phase 2: At this stage, $eths is a token. The basic layer can be compared to Arbitrum or Optimism, and different types of native projects will be born;
• Phase 3: In this stage, the Ethereum main network project will be expanded to the ecosystem of dumb contracts.

Principle of Capacity Expansion Implementation

The source of L2's new narrative is Etherscripts' ESIP-5 and ESIP-6 development proposals.

The ESIP-5 proposal refers to BulkEthscriptTransfersfromEOAs (batch transfer of inscriptions from EOA). Currently, only a single glyph can be transferred in a single transaction for non contract addresses, and ESIP-5 will support batch transfer of glyphs in a single transaction after its launch. ESIP-5 elevates EOA to the level of smart contracts by introducing the EOA batch transfer mechanism. According to the tweet from co-founder @ 0xHirsch, each transaction can transfer up to 4000 inscriptions, which only costs 0.11eth under current gas fees.

The ESIP-6 proposal refers to Opt-inEthscription Non uniqueness (choosing to include non uniqueness of inscriptions). Currently, only the first inscription with the same content (character) is considered valid. Such indexing rules can ensure the uniqueness and uniqueness of inscriptions, but there are limitations and problems for scenarios such as smart contracts that require the transmission of duplicate information. For example, the operation of Etherscripts virtual machines requires the exchange and verification of information between smart contracts and DumbContracts.

The core of Etherscripts is ESCVM, which can be analogized to EVM (Ethereum Virtual Machine).

The DumbContracts in ESCVM break away from the limitations of inscriptions as NFT hype, enter the fields of functionality and practicality, and officially enter the basic layer to compete with L2 solutions.

ESCVM provides a running environment similar to EVM for dummy contracts. A dummy contract can execute two commands: deploy (create a new contract) and call (call the state change function of an existing contract). The interaction of such contracts is a relatively special way of interaction. Because they are stored through inscriptions, they bypass EVM execution and storage costs (transactions are stored on the chain using calldata fields). This also allows dumb contracts to receive much lower fees than smart contracts.

Limitations

1. The function of a dummy contract cannot be directly called. If you want to send ETH through a dummy contract, you must go through a process similar to bridging.

(1) The user sends ETH to SmartContracts.

(2) Create an Etherscript for the smart contract and send a call to the dumb contract to notify them that SmartContracts has received the ETH.

(3) The dummy contract verifies whether the SmartContract is on the list of trusted SmartContracts, and then sends the asset to the user.

2. Limitations of openness and universality. Ethscripts do not allow arbitrary creation of dummy contracts and have no programmability. Its code is defined in the ESIP process along with other EthscriptionsProtocol rules. Compared to normal smart contracts, dumb contracts have many fewer functions and can only implement some basic content, such as Deploy, Swap, and so on.

3. Unable to solve some complex requirements. Although both Etherscripts and L2 are addressing the scalability and cost issues of Ethereum, some well-defined and simple requirements are more suitable to be addressed through Etherscripts. The L2 solution has better openness and versatility, larger capacity, and more three-dimensional.

summary

Although the skyrocketing prices and active community promotion have attracted great attention, based on the current technology implementation, Ethscripts cannot directly replace the position of L2 due to the limitations of openness and programmability, and can only implement some simple instructions, which cannot meet the needs of some developers. This is a significant test for the construction of the ecosystem. But Ethscripts are still in the early stages of development and have great potential for development.

There is still great uncertainty in the future development of Ethscripts, which requires developers to continuously update and improve, with a focus on the following two points:

1. Can we optimize or solve existing limitations;
2. Can the establishment of ecology attract users.

The low gas characteristic of Ethscripts is similar to that of L2, and it will be a good traffic tilt point when starting the L2 track. At present, the L2 project has been technically implemented and the facilities have been completed. At this time, the Etherscripts are still in the planning and design process, and time does not have an advantage. Using L2 as a promotional point is more about dividing up traffic. At this point, Ethscripts are like a blank sheet of paper, and it is not impossible for capital's favor, coupled with subsequent imagination and ETH's technological advantages, to become the beginning of a new track.