Ethereum co-founder Vitalik Buterin says Ethereum’s next phase of scaling can draw lessons from Bitcoin’s Utreexo technology, pointing to growing convergence between the two networks’ research into reducing the burden of maintaining blockchain state. In comments posted Sunday, Buterin credited Bitcoin developers for their work on UTXO-based architecture and Utreexo, a system designed to let Bitcoin nodes verify the network without permanently storing the entire set of unspent transaction outputs.
“We want Ethereum to have the best of UTXO-style state, dynamic state, and everything in between,” Buterin wrote. The comments are significant because Ethereum and Bitcoin have historically taken fundamentally different approaches to state. Bitcoin tracks spendable coins through its Unspent Transaction Output, or UTXO, model. Ethereum maintains a considerably more complex account-based state containing balances, smart contracts and application data. As Ethereum scales, however, maintaining that growing state becomes increasingly expensive for node operators.
Utreexo Attacks the State-Storage Problem
Utreexo was originally proposed by Bitcoin developer Tadge Dryja as a cryptographic accumulator for Bitcoin’s UTXO set. Rather than requiring every participating node to retain the entire collection of currently spendable outputs, Utreexo allows that information to be represented through a compact cryptographic structure. Users provide proofs demonstrating that the outputs involved in a transaction exist. The approach can dramatically reduce the storage requirements associated with running certain Bitcoin nodes, shifting some of the burden from persistent storage toward cryptographic proofs.
Ethereum cannot simply adopt Utreexo unchanged. Its state is substantially more complicated because decentralized applications continually create and modify smart-contract storage. But Buterin argues that Ethereum can incorporate similar principles across different types of state. Current Ethereum scaling research contemplates a spectrum ranging from UTXO-like state for relatively simple assets through static and temporary data structures to the fully dynamic state required by complex smart contracts.
Ethereum Wants Scaling Without Bigger Nodes
The broader objective is to break the relationship between higher transaction capacity and increasingly demanding hardware requirements. Ethereum’s roadmap already includes statelessness-related technologies intended to reduce how much information individual nodes must retain. Buterin previously proposed “partially stateless nodes,” under which node operators could maintain only portions of state relevant to them while obtaining other information when required. Ethereum’s official roadmap similarly describes statelessness, state expiry and history expiry as mechanisms for reducing the storage burden imposed by continued network growth.
The decentralization implications are important. Increasing Ethereum’s throughput without changing state management could eventually require node operators to purchase progressively more powerful hardware and storage. That risks concentrating validation infrastructure among professional operators and data centers. Buterin’s reference to Utreexo therefore represents more than praise for a Bitcoin engineering project. It points toward a broader design principle: blockchain capacity can increase without requiring every participant to permanently store everything. Bitcoin and Ethereum will continue to have very different architectures. But their scaling research is increasingly confronting the same constraint — how to process and verify substantially more economic activity while keeping independent verification practical. For Ethereum, borrowing ideas pioneered in Bitcoin’s Utreexo research could help make that trade-off considerably less severe.