Ethereum L2: The true opponent of public chains

Non- Ethereum contract public chain becomes a hot spot

In the past period of time, because the NFT was too hot, it caused congestion in Ethereum, and the gas fee was too high, which turned out most users. Naturally, other public chains took advantage of the trend, which led to the flow of users to smart contract public chains such as Solana, Avalanche, and Fantom. They have become a hot spot for the community.

However, with the cooling of NFT and the advancement of Ethereum L2, the ecology of Ethereum and DeFi has once again returned to people’s attention.

NFT cooling

From the perspective of OpenSea’s transaction volume, because its transaction fees are too high, and the NFT price is too expensive, fewer and fewer users can participate in it, which causes its popularity to begin to decline. Of course, if it subsequently adopts L2 technology (maybe Immutable or Arbitrum ), this situation may be changed.

  • OpenSea’s trading volume trends

Ethereum L2: The true opponent of public chains

(Opensea transaction volume trend, DuneAnalytics)

  • The changing trend of NFT with large transaction volume on OpenSea

Ethereum L2: The true opponent of public chains

(Change trend of transaction volume of some projects on OpenSea, OpenSea)

NFT is a long-term trend in the encryption field. It is similar to DeFi and will continue to develop rapidly. However, at a certain period of time, the bubble was too big and it could not maintain its popularity. The cooling of NFT eases the pressure on Ethereum L1, but under the current circumstances, it is the launch of L2 that can really alleviate the congestion of Ethereum.

The liquidity integration of Ethereum L2 is advancing at a speed visible to the naked eye

After the launch of Arbitrum and Optimsim, Ethereum L2 is advancing very quickly. In particular, the speed of Arbitrum has far exceeded people’s expectations:

  • Arbitrum’s TVL is growing fast

Arbitrum has only been launched a little over a week, and its locked assets have exceeded 1.5 billion US dollars, and it is still growing rapidly. Blue Fox Note predicts that the amount of locked assets will surpass most non-Ethereum public chains in the future. At present, in the non-Ethereum public chain, Solana ranks first, with TVL exceeding 10 billion U.S. dollars. In the future, Arbitrum has the opportunity to compete with Solana and even surpass it. For Arbitrum and L2, please refer to the previous articles of Blue Fox Notes “A Simple Understanding of Arbitrum “, ” Layer2 Track: Short-term OP, Long-term ZK “, “Layer 2, Ethereum and the Public Chain Pattern”, ” Ethereum’s Layer 2 Track ” , “The Breakthrough of Ethereum Layer2: What It Means “, etc.

Ethereum L2: The true opponent of public chains

(Arbitrum’s TVL trend, L2Beat)

  • Arbitrum users

Arbitrum has only been launched a little over a week, and its user growth curve is very steep, and it currently has more than 40,000 addresses.

Ethereum L2: The true opponent of public chains

(Arbitrum’s independent address change trend, Arbiscan)

  • Arbitrum transactions

Arbitrum’s daily transactions have exceeded 110,000.

Ethereum L2: The true opponent of public chains

(Arbitrum’s daily trading volume changes, Arbiscan)

  • Arbitrum’s TVL share in the Ethereum Bridge is growing fast

At present, Arbitrum’s share of the total locked assets in the Ethereum Bridge is 29.4%, and it is expected to soon surpass Polygon to rank first.

Ethereum L2: The true opponent of public chains

(Arbitrum’s TVL share in the Ethereum Bridge, DuneAnalytics)

  • The number of crypto products that can be used on Arbitrum continues to increase

There are already Uniswap , Sushiswap , DoDo, Balancer, MCDEX, MetaMask, Chainlink, etc., and a large number of DeFi and NFT such as MakerDAO and Curve are on the way.

Ethereum L2: The true opponent of public chains

(Arbitrum network will have more and more encryption products available, Arbitrum)

  • Optimism is also continuing to evolve

Optimsim has been launched for a long time. Although its development speed is not as fast as Arbitrum, its cumulative transaction volume has exceeded 1.59 million times, and the number of user addresses has exceeded 70,000. The overall performance is also very good.

Ethereum L2: The true opponent of public chains

(Optimism cumulative number of transactions, DuneAnalytics)

Ethereum L2: The true opponent of public chains

(Optimism cumulative number of user addresses, DuneAnalytics)

Ethereum L2: The true opponent of public chains

(Optimism daily transaction volume trend, DuneAnalytics)

Ethereum L2: The true opponent of public chains

(Optimism user growth trend, DuneAnalytics)

The real opponent of the non-Ethereum public chain is not Ethereum, but its L2

The current competitors of all non-Ethereum public chains or side chains are not Ethereum, but Arbitrum, Optimism, StarkWare, Fuel, Zksync, Loopring, Aztec, Connext, Hop…

If these public chains pass this barrier and surpass in terms of liquidity, locked assets, number of transactions and users, and ecological applications, they will have the opportunity to face Ethereum directly. These superficial data are the externalization of transaction speed, transaction cost, security, network effect and other aspects.

What needs to be emphasized here is that this is not to say that they have no chance to face Ethereum directly, and Ethereum is not insurmountable. However, the premise is that they have a much better experience than Ethereum L2. If they are just the same, or just cheaper and faster than L2, they will not be able to gain advantages, because there are security and Ethereum. Consideration of ecological convenience and network effect. At present, Ethereum is in an advantageous position in the competition.

The public chain battle is far from over

Before, people felt that the public chain dispute was over, but what happened in this cycle made everyone realize that the public chain dispute is far from over. The reason is simple, this is the real “Iron Throne”. The temptation of the tens of trillions of dollars of the “Iron Throne” is so great that people will follow suit and enjoy it.

In addition, the prominent contradiction between Ethereum’s demand and scalability also gives other contract public chains an opportunity to take advantage of. People are beginning to realize that it is difficult for Ethereum to dominate the world.

This has led to the current exciting situation. On the one hand, Ethereum’s L2 is developing, on the other hand, other public chains are also innovating, and the competition between the two parties is becoming increasingly fierce.

In this “iron throne” battle, the major public chain factions are actively attracting developers, funds, and users. Ultimately, it depends on comprehensive factors such as security, user experience (cost, speed), and ecological applications. . Some public chains will rise rapidly within a certain period of time because of incentives, but as the rate of return decreases, their attractiveness will also decrease. The public chain battle is not a temporary battle, but a protracted battle. A temporary rise does not explain much. Similar things have happened in history.

In any case, the public chain battle is far from over!

 

Posted by:CoinYuppie,Reprinted with attribution to:https://coinyuppie.com/ethereum-l2-the-true-opponent-of-public-chains/
Coinyuppie is an open information publishing platform, all information provided is not related to the views and positions of coinyuppie, and does not constitute any investment and financial advice. Users are expected to carefully screen and prevent risks.

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