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Layer 2 (L2)

Solana’s L2 Dilemma: Inevitable or Risky Move?

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Solana’s blistering rally has sparked discussions about its underlying blockchain and the launch of a Layer 2 solution by the end of 2025. Nick White, COO at Celestia, boldly claimed that L2s are inevitable, despite resistance against rollups from certain quarters. “An L2 will launch on Solana before the end of 2025. They can resist and shit on rollups to their hearts’ content, but it will happen whether they like it or not. Resisting modularity is futile.”

Echoing a similar sentiment, co-founder of Solana Labs Anatoly Yakovenko still emphasized that the primary goal of the SOL base layer is to maintain competitive fees even if layer-2 solutions arrive on the scene.

However, some expressed reservations about Solana’s L-2 quest. CEO of Blockchair Nikita Zhavoronkov warns against solely focusing on fully custodial centralized L2s. Instead, scale L1 to gain a competitive advantage over Ethereum, he wrote.

Modularity is good as long as everyone is not locked into custodial solutions. Ethereum is “modular” now, but all it has is fully custodial centralized L2s, which can steal user funds via admin keys. Solana’s selling point, which can overthrow Ethereum, is scaling L1. If Solana decides to scale via L2s instead of L1, it’ll lose its only competitive advantage over Ethereum.

While Solana proponents have discussed the possibility of rollups on the network, there’s a consensus that pushing the L1 network to its limits should be prioritized before adopting L2 solutions.

Solana Breaks Records in Price and Popularity

SOL’s impressive rally has boosted the altcoin troupe. Since hitting bottom in Dec. 2022, the token’s value has been soaring and has risen nearly twenty times from its lowest low, per market analyst Negentropic.

Based on Fib levels, a technical indicator that identifies potential areas of support and resistance in a price trend, popular trader Negentropic predicted a sustained upward movement in the price action. The Fib levels mentioned here are price targets: 268, 427, and 686.

Moreover, the search popularity of the word Solana reached 100, indicating the highest level of interest for this specific term. Not only that, this has set a new precedent in the blockchain’s 5-year history. Till now, the layer-1 network recorded the second-highest search popularity of 84 in early September 2021.

Shibarium’s Big Plan: 2024’s Game-Changing Shift in Community Empowerment

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The Shiba State unveiled “The Big Plan” for Shibarium, a groundbreaking initiative aimed at reshaping the future of governance in the community. This bold vision emphasizes decentralization, community empowerment, and inclusivity, promising to revolutionize the way decisions are made within the Shiba State.

One of the central pillars of Shibarium is the commitment to distribute power and decision-making across the community. This move away from centralized control ensures that every member has a voice, eliminating the dependence on a select few. The inclusion of all tokens in the decision-making process reflects a dedication to democratic values and fairness. By preventing the concentration of power in the hands of a select few, Shibarium fosters a balanced and equitable ecosystem.

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Source: Shib.io

Active participation is encouraged through this innovative approach to governance. Tokens with substantial voting power motivate members to engage, collaborate, and drive the community forward. This emphasis on engagement not only enhances the sense of belonging but also fortifies the community’s collective strength.

Shibarium’s Transparent Governance Model

One of the most striking features of the layer-2 blockchain is its commitment to fair and transparent governance. Equal voting power ensures that no single entity can wield disproportionate influence, guaranteeing that decisions are made for the greater good. This approach instills trust and confidence within the community, as members can rest assured that their voices truly matter.

Transparency is another cornerstone of Shibarium’s vision. The community values the importance of every token, and this ethos is reflected in a governance model that is open and decentralized. With the veil of secrecy lifted, trust and camaraderie flourish, creating a positive and nurturing environment within the Shiba State.

Perhaps the most compelling aspect of Shibarium’s vision is its dedication to sustainable growth. By embracing decentralization and empowering the community to make collective decisions, Shibarium is laying the foundation for long-term, sustainable prosperity. This approach reflects a deep commitment to the welfare of the community, ensuring that it thrives for generations to come.

In conclusion, Shibarium’s “The Big Plan” is a visionary and transformative approach to governance. It embodies principles of fairness, inclusivity, and transparency, promising to reshape the way decisions are made within the Shiba State. By embracing decentralization and community empowerment, Shibarium is paving the way for a future where every member has a voice, trust prevails, and growth is sustainable. This is not just a plan; it’s a paradigm shift in governance.

Ethereum vs. Layer 2 Networks: Unveiling Adoption Dynamics

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In the dynamic realm of blockchain technology, the interplay between Ethereum and emerging layer 2 networks has become a captivating narrative. By examining the number of unique addresses across different platforms, a fascinating landscape of adoption patterns emerges, shedding light on the evolution of layer 2 solutions.

As of August 20, 2023, Ethereum stands as a titan with a staggering 241,547,687 unique addresses. However, layer 2 networks are rapidly gaining traction, showcasing promising figures:

  • Arbitrum: With 11,428,063 unique addresses, Arbitrum emerges as a notable contender in terms of adoption.
  • Optimism: Boasting 8,058,612 unique addresses, Optimism solidifies its position in the layer 2 ecosystem.
  • zkSync: Not far behind, zkSync garners 1,826,590 unique addresses, indicating growing interest.
  • Base: Within a remarkably short span since its official launch on August 9, 2023, Base manages to amass 1,049,890 unique addresses, positioning itself as the fastest-growing layer 2 solution.
  • zkEVM: Polygon zkEVM secures 399,181 unique addresses, showcasing the diversity within the layer 2 landscape.
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Source: CoinGecko

A closer examination reveals a compelling trajectory of adoption speed. Early layer 2 networks, such as Arbitrum and Optimism, experienced adoption over extended periods, requiring 303 and 191 days, respectively, to reach 1 million unique addresses. In contrast, zkSync’s agile adoption journey culminated in just 71 days, underlining the acceleration in adoption rates.

Remarkably, Base’s ascent sets a new standard for swift adoption, achieving 1 million unique addresses within a mere 11 days. This can be attributed to its Coinbase-backed ecosystem and a wave of memecoins, including Bald (BALD), which gained significant market capitalization, propelling interest and usage.

Ethereum Dominates with 241 Million Addresses

A noteworthy observation is the correlation between native tokens and adoption speed. Networks like zkSync and Base, devoid of native tokens, exhibit rapid adoption. Users’ anticipation of token airdrops, a phenomenon evident on zkSync, fuels engagement. Conversely, networks like Optimism and Arbitrum, which airdropped tokens to early users, followed a comparatively more extended adoption trajectory.

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Source: CoinGecko

Arbitrum’s commanding 11.4 million unique addresses position it as the largest layer 2 network, closely pursued by Optimism with 8.0 million. In contrast, zkSync and Base, with 1.8 million and 1.0 million unique addresses respectively, signify robust growth.

Although layer 2 networks make remarkable strides, Ethereum maintains its supremacy with a monumental 241 million unique addresses. This discrepancy highlights the enduring dominance of Ethereum within the blockchain ecosystem.

In conclusion, the landscape of Ethereum and layer 2 networks unveils a dynamic interplay between adoption rates, token incentives, and network size. The rapid ascent of Base and zkSync underscores the evolving nature of blockchain adoption, while Ethereum’s towering user base remains unchallenged. As the industry advances, these insights illuminate the evolving tapestry of blockchain technology, shaping its trajectory in the years ahead.

Ethereum Layer 2s Surge: Transaction Numbers Reach 3x Bull Market Peak

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The transaction numbers on Ethereum and its top Layer 2 (L2) solutions have surged to nearly three times higher than the previous bull market peak. This remarkable growth within the L2 ecosystem has not adversely affected the Ethereum mainnet, where transaction volumes have remained stable at approximately 1 million transactions per day.

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Spotlight on Ethereum Layer 2s

According to the latest report by IntoTheBlock’s weekly newsletter, this week’s spotlight is on ETH’s Layer 2 scaling solutions. A detailed analysis of the competitive landscape within optimistic rollups and key metrics reveals their profound impacts on the broader Ethereum network.

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Ethereum Layer 2s Surge: Transaction Numbers Reach 3x Bull Market Peak 7

Despite consistent transaction levels, network fees for Bitcoin have experienced a 16.6% drop. On the other hand, ETH fees have risen by 2.6%, particularly in response to heightened market volatility.

Exchange netflows have seen a remarkable trend, with Bitcoin and ETH witnessing $400 million in outflows from centralized exchanges. It suggests a move by holders to secure their assets by retaining custody.

Ethereum L2 Activity Soars

Ethereum’s L2 solutions have rapidly gained traction over recent months, with new Layer 2s launching almost weekly. Coinbase’s Base L2, built on the Optimism infrastructure, has quickly attracted users, temporarily surpassing Optimism in daily transactions shortly after its launch.

Optimism’s momentum is palpable, as its transactions reached an all-time high, surpassing those of Arbitrum for the first time in 2023. Sam Altman’s Worldcoin launch on the Optimism network significantly contributed to this surge.

While the competition among Layer 2 solutions intensifies, ETH continues to reap benefits. The total number of transactions involving L2s has soared to three times the bull market peak, yet Ethereum’s mainnet remains resilient, maintaining its transaction volume of approximately 1 million transactions per day.

Arbitrum remains dominant in decentralized finance (DeFi), boasting financial applications’ highest liquidity and activity. Within a short span, Coinbase’s Base L2 has accumulated an impressive $170 million in total value locked (TVL), surpassing Cardano and Bitcoin.

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Ethereum Layer 2s Surge: Transaction Numbers Reach 3x Bull Market Peak 8

An upcoming Ethereum upgrade, EIP-4844 (Dencun), is expected to reduce L2 transaction costs by 10x-100x drastically. Although the launch timeline is yet to be confirmed, Ethereum’s developers are gearing up for the Devnet 8 testnet, which will feature the proposed improvements.

Amidst market volatility, Ethereum’s Layer 2 solutions have proven to be a bright spot. Optimism has seen remarkable adoption, Base has emerged as a rapidly growing chain, and Arbitrum continues to dominate DeFi. 

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