Ethereum co-founder Vitalik Buterin announced plans at EthTokyo 2025 to scale the network tenfold within a year via Layer 2 solutions, while advocating for revitalized Initial Coin Offerings and DAO governance models.

Executive Summary

At EthTokyo 2025, Ethereum co-founder Vitalik Buterin announced plans to scale the network tenfold within a year via Layer 2 solutions. He also advocated for revitalized Initial Coin Offerings (ICOs) and Decentralized Autonomous Organization (DAO) governance.

The Event in Detail

Buterin's address centered on Ethereum's commitment to achieving a 10x scalability increase over the coming year, emphasizing the importance of maintaining decentralization and security. This scaling initiative will predominantly leverage Layer 2 solutions, which handle transactions off-chain before settling them on the main Layer 1 network. Technical advancements, including ZK-Rollups, improvements to the Ethereum Virtual Machine (EVM), and the development of stateless nodes, are foundational to this strategy. The timeline for full implementation is projected slightly beyond one year, allowing for careful execution and continuous performance monitoring. Recent upgrades like the Pectra Upgrade in May 2025 increased the maximum stake per validator to 2,048 ETH and introduced blob data expansion, boosting throughput to 9 blobs per block, directly reducing Layer 2 operational costs. The upcoming Fusaka upgrade, scheduled for November 2025, will further reduce Layer 2 costs through EIP-7594's PeerDAS and increase gas limits from approximately 45 million to 150 million.

Business Strategy & Market Positioning

Beyond technical scaling, Buterin advocated for a revival of ICOs and DAO governance. He posited that ICOs historically offered a globally accessible fundraising mechanism, often less constrained by regulatory hurdles faced by traditional venture capital (VC) funding.

“The VC era,” he suggested, “has been more constrained by regulations, and honestly, you can still get rugged by VCs.” DAO development companies are emerging to build robust, secure, and scalable DAOs, facilitating funding through ICOs and fostering community-driven decision-making. This strategy positions Ethereum not just as a scalable technological infrastructure but also as a proponent of alternative, decentralized funding and governance models, contrasting with traditional corporate finance structures.

Market Implications

The proposed 10x scaling, driven by Layer 2 solutions, is anticipated to significantly enhance Ethereum's network efficiency, reduce transaction fees, and promote broader adoption. Layer 2 solutions are already lowering gas fees by 90% or more, enabling faster transaction processing and improving interoperability for decentralized applications (dApps) and DeFi platforms. Protocols like Aave, Uniswap, and Curve are utilizing Arbitrum, Optimism, and zkSync, while NFT and gaming ecosystems leverage Immutable X and Polygon. This evolution is expected to increase interest and potential price movement for ETH and Layer 2 tokens. Buterin's support for ICOs and DAOs could ignite new trends in fundraising and governance, potentially drawing fresh capital and projects into the Web3 space. Ethereum's proactive approach to quantum-resistant cryptography by 2026 also addresses long-term security concerns. Current market conditions reflect a shift, with gas fees around $0.08 and Layer 2 transaction volume now representing 60% of the network's total activity, indicating a growing reliance on these scaling solutions.

Broader Context

Ethereum's long-term roadmap, including the “Lean Ethereum” plan, aims for 10,000 transactions per second (TPS) on Layer 1 and over one million TPS across Layer 2 networks by 2026, alongside the integration of zkEVMs. Buterin also acknowledged Asia's foundational contributions to Ethereum's early development, including client development and whitepaper translations, underscoring the global nature of the project. The confluence of technical upgrades, regulatory clarity, and institutional adoption, evidenced by over $12.7 billion in ETF inflows and annual staking yields of 4.5%, positions Ethereum at a critical juncture for continued evolution and expanded influence in the digital economy.