Ethereum Reaches New ATH in Transactions Per Second

The Ethereum network has achieved a noval milestone, hitting an all-time high (ATH) in transactions per second (TPS). Industry has cited a huge increase in activity on a Ethereum layer-3 network, as the reason for this milestone. The surge in L3 activity led to a rise in the combined TPS across the ecosystem to new heights.

Ethereum Hits New Milestone

According to data from L2beat, on June 16, Ethereum’s scaling networks, including both layer-2 and layer-3 blockchains, together recorded an mind boggling 246.18 TPS. This basically means that 21.2 million transactions executed within a single day, reflecting on the user-friendly and robust scalability enhancements recently included in the Ethereum network.

Ethereum has been often called out for its high fees and network congestions. It seems that the blockchain has now chosen a different path.

A substantial portion of these transactions on Ethereum, over 41%, occurred on Xai, a newly emerging layer-3 scaling solution focused on gaming applications.

Xai Makes it Big

Xai, powered by Offchain Labs, the firm behind the well-known Arbitrum One blockchain, has seen a humongous rise in its TPS. Before June 10, Xai’s TPS was around one per day, but it has since increased and peaked at 101.72 TPS on June 16.

In addition to Xai, other prominent Ethereum scaling solutions also contributed to the high TPS. Base and Arbitrum recorded 33 TPS and 21 TPS, respectively. Proof of Play Apex, a gaming-focused layer-3 scaler launched by Offchain Labs, secured the fourth position in terms of TPS.

TVL Remains Underwhelming

Despite the impressive transaction volumes, the total value locked (TVL) in Xai and Proof of Play Apex remains relatively modest. Xai’s TVL stands at $1.38 million, while Proof of Play Apex holds $695,000. In contrast, Arbitrum One and Base, the two largest Ethereum scaling solutions by TVL, boast significantly higher figures, securing $18 billion and $7.6 billion, respectively.

Ethereum TPS is Not an Accurate Indicator

The surge in TPS has reignited discussions among industry analysts regarding the relevance of this metric in evaluating blockchain performance. Experts debate that TPS can be a somewhat misleading indicator. Steven Goldfeder, a founder at Offchain Labs, likened TPS to “counting the number of bills in your wallet but ignoring that some are singles, some are twenties, and some are hundreds.”

However, despite its limitations, TPS remains a widely used metric due to the lack of a universally better alternative. Goldfeder emphasized that while TPS might not provide a complete picture, it still offers a useful snapshot of network activity and scalability.