Layer 2 technology is a powerful extension of the blockchain technology stack. Address scalability issues and high fees. However, his TVL across L2 networks today remains relatively low, with some caveats to consider.
Layer 2 networks should lock more totals
Layer 2 networks can play an important role. scaling blockchain technology. This is especially true for Ethereum, a network hampered in the past by technical constraints and high fees. However, in the last year or so, things have improved and Ethereum has been able to continue to be his go-to network for DeFi, NFT, GameFi, and more. correct context.
Currently, Arbitrum One is reading Layer 2 network with Total Value Locked. This equates to his $2.22 billion, or more than 52% market share. Rather, it shows how dependent the L2 ecosystem is on this particular solution. With universal application properties and optimistic rollup technology, it stays ahead. Still, $2.22 billion is far less than most enthusiasts expected.
The second candidate is optimism, with a TVL of $1.19 billion and a market share of 28.25%. It’s a bit of a problem when two projects make up his 80%+ of the industry. This shows that other networks are either woefully inadequate or struggling to attract viewers. It is not always ideal to pool resources in just two networks.
The top 3 for Layer 2 by TVL are: dYdXThis is an exchange protocol, but first and foremost, it has a total locked value of $401 million. This is enough to get a market share of 9.45%. Astute readers will note that three projects control his 90% of his L2 space. If there is a conflict, something needs to be changed immediately.
Other L2 Struggles for Value
There is no shortage of Layer 2 networks trying to scale blockchains. Most projects use ZK Rollup or Validium to achieve that goal. Notable candidates include Loopring, Metis Andromeda, Immutable X, zkSync and ZKSpace. Unfortunately, these networks currently hit less than $100 million in TVL. However, they all offer significant benefits, and the reasons for this have yet to be determined.
Additionally, many smaller networks have native assets that make up the majority of their TVL. For Metis Andromedia, that token represents over 50% of TVL, as it does for Loopring, Immutable X, and Boba Network. It’s not necessarily a problem, but it’s something to consider.
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