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Ecosystem fragmentation is not necessarily a bad thing. It leads to rapid development through competition. Different L2s are competing against each other to pro
by pa7x1 3y ago
Ecosystem fragmentation is not necessarily a bad thing. It leads to rapid development through competition. Different L2s are competing against each other to provide the best service and that has lead to a cambrian explosion of solutions. It's also a very effective way to explore the solution space, I'm sure many will disappear, others will get eaten, and at some point there will be consolidation. But all this seems like a good approach early on when tackling complex problems for which the ideal trade-offs are not entirely obvious. Explore as much of the solution space as possible and trim later on.
A perhaps more pernicious problem is liquidity fragmentation. Moving assets between L2s is a tedious friction that leads to fragmentation of liquidity. In that respect, zero-knowledge rollups present a big advantage as you can share liquidity between them as long as they share some zk-circuits that allow to prove statements to both chains. All this is being very actively worked on. And the technology behind it is short of fascinating. The typical HN audience would have a huge hard-on for it, if they didn't have such a strong preconception against crypto-anything.
If anyone is curious to learn more about L2s a good starting point is here: https://l2beat.com/ https://l2beat.com/
And if you want to see Ethereum scaling progress you can check it here: https://l2beat.com/scaling/activity https://l2beat.com/scaling/activity
The next major upgrade to the protocol, slated for late this year or early 2024 (date is not finalized yet), will focus on scalability by making L2 activity veeery cheap.
- dleeftink 3y agoThe tech is no doubt, impressive. If we liken it to a Cambrian explosion however, there is no guarantee it'll settle to a local optimum, just as the smallest genetic differences would prove it difficult for different genealogical branches to produce viable offspring. But as you said, it might be the quickest way to explore the solution space. We may just see a lot of unviable branches in the mean time.