A mysterious Redditor has made a prediction based on data that the next big step in blockchain development will be in layer-2 solutions, mostly on Ethereum.
The May 22 post says, "We're at a turning point." The industry is moving away from bridging between L1 blockchains and toward L2s, which are "right out of the gate, more secure and decentralized than alt-L1s and are built to use sound money on a credibly neutral platform:" An L2 scaling solution takes advantage of the security of an L1 chain like Ethereum and reduces the amount of traffic on it by "rolling up" a number of transactions into a single package to be settled all at once.
Users who don't like high fees have turned to other L1 chains like Solana, which has transactions that are fast and don't cost much. At the time this was written, a Solana (SOL) transaction costs about $0.0025, while an Ether (ETH) transaction costs about $1.30. Even with this huge difference, demand for Ethereum block space has been much higher than demand for Solana block space. This is because Ethereum's total value locked (TVL) is $73.89 billion, while Solana's TVL is $4.24 billion. Solana has also been having problems with being reliable lately.
At the time of writing, Arbitrum had $2.65 billion in TVL, making it the biggest L2 on Ethereum, according to L2beat. The TVL of the whole Ethereum L2 ecosystem is $4.77 billion. If the right forces come together to pull users and money away from other L1s, these numbers could go through the roof. Several of the biggest decentralized applications (DApps) are already running on L2s. On Arbitrum are the decentralized exchange (DEX) SushiSwap and the yield aggregator Curve. On Optimism, the crypto derivatives protocol Synthetix and the DEX Uniswap are listed.
MakerDAO uses the layer-2 network StarkNet to improve how the DAI stablecoin works. The coming Optimism airdrop could be the start of a large number of new users joining L2s quickly. This could be because of the same network effects that brought people to Ethereum and decentralized finance (DeFi) protocols based on Ethereum Virtual Machine (EVM) over the past two years.
The L2 ship Optimism has $474 million in TVL. EVM chains are those that work with Ethereum token standards. Binance Chain (BNB), Polygon (MATIC), and Fantom are all examples of EVM chains (FTM). In the end, if L2 becomes more useful, Ethereum L1 will naturally become more popular. This could make Ethereum even more popular as the best platform for smart contracts and decentralized apps.
Scaling up Ethereum's second layer After the much-anticipated launch of Optimism's airdrop on Wednesday, the company has been hit with "all-time high demand." As the Optimism team worked behind the scenes to add more capacity to the network, users trying to get their tokens were met with failed or slow transactions.
As was reported in April, Optimism is airdropping the new OP governance token in multiple stages. This is happening at the same time as the launch of "The Optimism Collective," a decentralized autonomous organization (DAO). Nearly 250,000 addresses can get the airdrop. Early adopters of Optimism and regular Ethereum users like DAO voters, multi-sig signers, and bridge users are eligible.
According to Optimism Status, the mainnet's performance was bad for about three and a half hours. To fix the problem, the team "provisioned more capacity." So, the functionality of archive nodes is temporarily limited until the network load goes down. Optimism said on Twitter that it would use what it learned from the first airdrop to improve the second one, and that it would also write a "extensive retrospective" about what happened next week.