Ethereum layer 2 continues to generate enthusiasm
This is not news to anyone, Ethereum (ETH) fees have become prohibitive in recent months, and the trend does not appear to be reversing. In November, average fees hit record highs, rising + 700% over the past four months.
The use of second layer solutions, or layer 2, has therefore become common if one wishes to interact with the network without paying exorbitant fees.
Hence this breakthrough in total locked value (TVL) on “layer 2”, which has reached a new record in recent days. According to data from L2Beat, more than 1.28 million ETH was locked down this weekend, or $ 5.6 billion at the moment.
This corresponds to an increase of + 7.4% over the last seven days. It is the layer 2 Arbitrum which largely leads in terms of locked value. Its market share is over 47%. It is followed by dYdX, with 17%, and Loopring in third place, with 10%:
Classification of layer 2 by locked value – Source: L2beat.com
Ethereum criticized against its competitors
Right now, a simple ERC-20 token transfer over the Ethereum network can cost the user over $ 40. On November 9, the average costs were over $ 62, and the increase was seen over time:
Increase in average transaction fees on Ethereum – Source: Messari
Some therefore criticize a network that only becomes affordable if an external solution is used, the first layer being too expensive. Several major figures have expressed their disillusionment with the payment network, including Zhu Su, CEO of Three Arrows Capital:
Yes I have abandoned Ethereum despite supporting it in the past.
Yes Ethereum has abandoned its users despite supporting them in the past.
The idea of sitting around jerking off watching the burn and concocting purity tests, while zero newcomers can afford the chain, is gross.
– Zhu Su
“Yes, I gave up on Ethereum despite supporting it in the past. Yes, Ethereum has abandoned its users, although it has supported them in the past. […] No newcomer can afford to use blockchain. “
The whole question is therefore whether Ethereum will manage to retain its first-mover advantage, while its competitors are starting to gain momentum. The race towards Ethereum 2.0 and the proof of stake is in any case more crucial than ever for the second largest cryptocurrency of the moment.
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About the author: Marine Debelloir
Associate Editor on Cryptoast, I fell into the pot of cryptocurrencies a few years ago. I am passionate about the innovative technologies that arise from the blockchain and I like to find the most delicious information to share with you.
All articles by Marine Debelloir.