Transaction Speed, Network Activity, and Power Consumption in Ethereum, Ethereum Layer 2, and EVM-Compatible Protocols: A Quantitative Study

Abstract

Ethereum is rapidly expanding through cross-chain linkages with its layer 2 and EVM-compatible blockchains. As it is already the largest ecosystem in terms of the number of users, applications, and economic value, it is of a great importance to study the speed, network activity and power consumption of its protocols. Furthermore, understanding the correlation between network activity and power consumption is important to gain insight into those protocols' scalability. An examination of Ethereum, Ethereum Layer 2 (Arbitrum and Optimism), and EVM-compatible (Avalanche, BSC, and Harmony) blockchain protocols revealed that emerging Ethereum Layer 2 and EVM-compatible blockchains are faster than Ethereum. Pearson analysis between power consumption and network activity showed weak correlations. Furthermore, there is no evidence of Granger causality between the power consumption and the network activity in either direction for any blockchain protocol. This finding suggests that power consumption is independent of network activity, indicating that protocols that consume less power do not do so because of their low network activity, but rather because of protocol-specific optimization. This also shows that these protocols can potentially scale with user growth. This study, therefore, serves as a valuable insight for those planning to implement blockchain protocols tailored to their industry requirements.