Ethereum Tackles Storage Crisis with UTXO-Style Scaling Approach

Ethereum is re-examining its scaling strategy as the increasing amount of network data makes running a full node increasingly demanding. Full execution nodes now require around 0.9 to 1.3 TB of storage, and baseline state growth can approach 100 GB annually.

Vitalik Buterin has suggested looking beyond processing more transactions and towards reducing what nodes must retain. He credits Bitcoin developers for Utreexo, a system that lets nodes store far less data.

Ethereum's proposed change matters since approximately 80% to 82% of the data held on Ethereum is produced as new permanent records. A UTXO-style approach could provide an alternative way to process payments without adding large amounts of permanent records, potentially reducing storage requirements for nodes by nearly 99.8%