Sirwin
Sirwin

Next Trend of Centralized Layer 2 Chains

By idiosyncratic | Idiosyncratic Crypto | 15 Mar 2023


The interest in blockchain technology has been increasing over the last 6 years. The trend of crypto was hot among retail investors when we trace back to 2017-2018 but today, the main actors are no longer retail investors.

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In the crypto ecosystem, the mass adoption phases are divided into 3 sections. The first phase is the use by everyday people like all of us. The second phase is seen as the integration of blockchain technology and crypto assets by the companies. Though the trend of NFTs, the growth of De-Fi, and the layer 2 solutions were not available for years, now it is the time for the giant corporations.

Obviously, the dream of paying for your coffee at Starbucks with your cryptocurrency became real a long time ago. Considering the simplicity of the expectation by the crypto investors, these times were not applicable for companies to adopt crypto. However, the crypto ecosystem in 2023 has room for even governmental operations.

Controlled Chains & Mainnets

Crypto ecosystem looked for "the chain" for a long time. Ethereum has always been the chain of everything but it was suffering from transaction fees, complexity and decentralization matters. On the other hand, Avalanche and Solana were two great possibilities to be the chain of several operations. Afterwards, we started to see the rise of Layer 2 solutions at the top of Ethereum.

Crypto companies focused on Cosmos, Flow, Fantom and many other promising options but, in the end, the interaction and liquidity on Ethereum outperformed the promising ones. Putting the speculations on Solana aside, Avalanche, Ethereum and layer 2s like Polygon, Arbitrum and Optimism are seen as possible targets.


Easier to Set Centralized Layer 2

Imagine starting a new Ethereum killer that is aimed to have some liquidity and engagement on it. Actually, the Ethereum killers either killed themselves or they are not cared about as expected.

Using the growth and trustworthiness of Ethereum mainnet sounds like a good idea for many people. In this way, easy cross-chain swaps and attention on the chain provide popularity and control over the transactions on the chain.

Blockchains are impossible to kill. Neither the pressure by centralized banks nor the market conditions are enough to stop developers build the world of blockchain. While there is such a potential on this new trend, it would not be likely to think of governments or companies do not choose to utilize the opportunity that is served. 

Regulation-friendly chains or layers may gain power in time. Do you have any guesses for the possible layers?

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