Vitalik Buterin, the co-founder of Ethereum, has recently expressed a shifting stance on native rollups, signaling potential advancements in Ethereum's layer-2 scaling solutions. In a tweet dated January 19, 2026, Buterin stated that he is definitely more in favor of native rollups than before. This change comes as ZK-EVMs have matured, addressing previous concerns about their immaturity in zk mode versus optimistic mode. For traders, this development could influence ETH price dynamics, as native rollups promise enhanced scalability and lower transaction costs, potentially boosting Ethereum's adoption and market sentiment.

Ethereum's Native Rollups and Market Implications

Delving deeper into Buterin's comments, he highlighted that a native rollup precompile must operate in either zk mode or optimistic mode. Previously, the immaturity of ZK-EVMs made zk mode unfeasible, leaving layer-2 projects with limited options, such as 2-7 day withdrawal periods in optimistic setups. Now, with advancements in zero-knowledge proofs, Buterin sees a path forward for more efficient rollups integrated directly into Ethereum's protocol. From a trading perspective, this could catalyze bullish momentum for ETH. Historically, Ethereum upgrades like the Merge in September 2022 led to significant price rallies, with ETH surging over 20% in the following weeks according to market data from that period. Traders should monitor ETH/USD pairs for similar patterns, watching support levels around $2,500 and resistance at $3,000 based on recent trading sessions.

Trading Opportunities in Layer-2 Tokens

The endorsement from Buterin may also spotlight layer-2 tokens like those associated with Optimism (OP) and Arbitrum (ARB). As native rollups gain traction, these ecosystems could see increased on-chain activity and trading volumes. For instance, if Ethereum implements native rollup support, it might reduce reliance on third-party bridges, minimizing risks and fees. Traders could look for arbitrage opportunities between ETH and L2 tokens; during past hype cycles, OP token volumes spiked by 150% within 24 hours following major announcements, as observed in early 2023 data. Current market sentiment suggests a positive correlation: if ETH breaks above key moving averages, L2 tokens often follow with amplified gains. Institutional flows into Ethereum-based funds, which reached $1.2 billion in net inflows during Q4 2025 according to reports from financial analysts, could further amplify this trend, presenting long positions as attractive for swing traders.

Moreover, this shift ties into broader crypto market trends, where scalability remains a key driver. Bitcoin (BTC) has dominated headlines with its halvings, but Ethereum's focus on rollups positions it as a leader in decentralized applications. Traders should consider cross-market correlations; for example, a rise in ETH dominance often pressures altcoins, but L2 solutions could counter this by attracting developers and users. On-chain metrics, such as daily active addresses on Ethereum, which hovered around 500,000 in mid-January 2026 per blockchain explorers, indicate growing adoption. Pair this with trading volumes: ETH's 24-hour volume exceeded $10 billion on major exchanges last week, suggesting liquidity for entering positions. Risk management is crucial—volatility spikes during upgrade discussions could lead to 10-15% drawdowns, so setting stop-losses below recent lows is advisable.

Broader Crypto Trading Strategies Amid Ethereum Advancements

Incorporating this news into trading strategies, investors might explore derivatives markets. ETH futures on platforms like CME showed open interest peaking at $8 billion in December 2025, reflecting institutional interest. Buterin's positive stance on native rollups could drive further inflows, potentially pushing ETH towards all-time highs if macroeconomic conditions remain favorable. For stock market correlations, tech giants like those in AI and blockchain sectors often move in tandem with crypto; a surge in ETH could benefit related stocks, creating hedging opportunities. Overall, this development underscores Ethereum's evolution, offering traders a narrative-driven entry point while emphasizing the need for due diligence on technical indicators like RSI and MACD to confirm uptrends.