# Ethereum Layer 2 Solutions Under Scrutiny: Parasite or Catalyst?
Controversy surrounding Ethereum’s Layer 2 (L2) scaling solutions has reignited. Critics argue that these solutions drain mainnet revenue and isolate liquidity in a ‘parasitic structure.’ In contrast, proponents highlight the cost-effective and secure scalability that L2 solutions provide.
In light of this debate, on-chain research platform OurNetwork analyzed recent data from key L2 solutions, including Arbitrum (ARB), Optimism (OP), Blast (BLAST), and Abstract (ABSTRACT).
# Majority of Ethereum Growth Occurs on L2
According to Growthepie, most active Ethereum addresses since 2023 are on L2. Approximately 80% of all active addresses operate on a single L2, while wallets transacting on multiple L2s account for only about 5%.
Data storage via ‘blobs’ has surged in usage as well. L2 solutions utilize blobs to post transaction data on the Ethereum mainnet. Base leads in blob usage, accounting for roughly 40% of the total, while Eclipse dominates Celestia (TIA) with over 80% of posted data.
The proportion of MEV (Maximal Extractable Value) related transactions in recent L2 trades has increased, whereas the share of DeFi transactions declined from 16% to 12%. Uniswap (UNI) remains the most heavily traded application.
# Arbitrum: Rising Hub for Real-World Assets; Optimism Centers on Bot Transactions
OurNetwork’s analysis reveals that Arbitrum is rapidly establishing itself in the real-world asset (RWA) market. Traditional financial players such as Franklin Templeton, BlackRock, and WisdomTree, alongside crypto-based projects like Mountain Protocol, Estate Protocol, and SPiCO, are involved.
Arbitrum One boasts 19 stablecoins, each with over $1 million in Total Value Locked (TVL). The testnet stablecoin from Wyoming, WYST, is also gaining attention.
Conversely, Optimism has seen a decrease in active addresses despite a rise in transaction volume. According to Katerina, while the total number of accounts, including smart contract accounts, has dropped by 25%, transaction volume has surged by 95%. Notably, 40.3% of the transactions are driven by DEX trading bots.
# Abstract and Blast: Pursuing Expansion Through Innovative Methods
Abstract focuses on consumer-friendly applications, offering gas-free, click-free transactions through its smart wallet, Abstract Global Wallet (AGW). Surf Query reports over 290,000 account abstraction transactions to date and processing over $28 million via session keys.
Myriad Market, a flagship dApp combining prediction markets and media content, has recorded over 3.7 million transactions since its launch.
After experiencing a slump post-Token Generation Event (TGE), Blast rebounded with the roll-out of its mobile app in January. OurNetwork reports a 421% spike in new addresses and over a 57% increase in transaction volume during March.
The app’s ‘Earn’ feature has garnered approximately $48 million in total deposits, drawing attention with an 80% annual percentage yield (APY). Nevertheless, DeFi TVL remains down 85% from its peak.
# Ongoing Experimentation in Scaling Solutions
OurNetwork states, “The debate over whether L2 solutions parasitize Ethereum or contribute to ecosystem expansion is ongoing. Each L2 is exploring its own strategy for growth.”
Future upgrades and fee optimizations could potentially accelerate L2 growth once again.
