TLDR
Vitalik Buterin praised Bitcoin’s Utreexo project while discussing Ethereum’s scaling research.
A new proposal suggests native UTXO-style payments could cut Ethereum’s permanent state usage by about 99.8%.
The plan would keep Ethereum’s account system while adding a lighter option for simple payments.
EIP-8141, known as Frame Transactions, is only “considered” for the Hegotá upgrade, not confirmed.
Buterin’s separate recursive-STARK research targets mempool bandwidth, not unlimited transaction throughput.
Ethereum co-founder Vitalik Buterin spoke about the network’s scaling future on Aug. 16. He praised Bitcoin developers for their work on a project called Utreexo.
Buterin described a possible scaling direction for Ethereum. It could mix UTXO-style data, standard account data, and models that sit between the two.
He called it the “current proposed Ethereum scaling strategy” in a post on X. He also made clear the design is still being worked on.
Buterin said the goal is to let Ethereum handle more activity without hurting decentralization. Node operators should still be able to run the network easily.
His comments do not mean Ethereum is switching to Bitcoin’s UTXO system. The idea remains a research proposal, not an approved protocol change.
What Is Utreexo?
Utreexo was created by MIT researcher Thaddeus Dryja in 2019. It gives Bitcoin nodes a smaller way to track unspent transaction outputs.
Instead of storing the full list of outputs, nodes use a compact hash-based structure. Transactions carry proofs that let nodes check outputs without holding all the data.
MIT’s research says this structure grows slowly even as the underlying data set grows. That helps solve a common problem, which is keeping storage needs low as network use rises.
Utreexo is a Bitcoin project. Ethereum researchers are not copying it directly, but they are studying similar ideas.
Ethereum’s Native UTXO Proposal
On July 6, Ethereum researcher Toni Wahrstätter posted a proposal under the name Nero_eth. It suggests adding UTXO-style payments to Ethereum without removing its account system.
The idea targets simple, one-time payments that do not need ongoing smart contract data. These payments would use a lighter data format.
The proposal estimates this could lower permanent state use by about 99.8% for these transaction types. Instead of storing full payment records, Ethereum would keep a small marker showing whether a payment was already spent.
At one billion entries, the design estimates around 300 MB of permanent state. That compares to an estimated 100 GB to 150 GB under the current account model. These are estimates from the proposal, not results from live testing on the main network.
The plan depends on a separate proposal called EIP-8141, or Frame Transactions. This would let developers build transactions with custom steps for validation, gas payment, and execution.
Ethereum’s official Hegotá specification lists Frame Transactions as only “considered for inclusion.” FOCIL, another proposal, is currently the only one formally scheduled for Hegotá.
Ethereum’s roadmap places Hegotá in 2027. That comes after the Glamsterdam upgrade, expected in the fourth quarter of 2026.
Buterin has also researched a separate idea using recursive STARK proofs. This work focuses on reducing the amount of data mempool nodes must share with each other.
In his January research, Buterin used an example of eight peers checking in every 500 milliseconds. Under that setup, added bandwidth would total about 2 MB per second per node and stay steady as more items are added.
Some community members have suggested combining the UTXO proposal with recursive STARK proofs. They describe a system that could handle a large volume of transactions through one compact proof.
That combination is not a confirmed plan. Buterin’s research does not set a fixed number for Ethereum’s future transaction capacity.
For now, Ethereum’s UTXO and scaling ideas remain in the research stage. Developers are still deciding which pieces to include in future upgrades.
