Ethereum L2 Ecosystem: A Future of Expansion and Coexistence

With the rapid development of Layer 2 (L2) solutions, some people have begun to worry whether this will undermine the position of the Ethereum mainnet (L1). However, after a thorough analysis, we find that L2 is actually an indispensable part of the Ethereum ecosystem, and there exists a symbiotic relationship between the two.

First, the security of L2 essentially relies on Ethereum L1. Secondly, considering the processing capacity limitations of Ethereum L1 itself, the existence of L2 is crucial for Ethereum to maintain its competitiveness. Without L2 to provide scalability, Ethereum may find itself at a disadvantage in competition with other public chains.

Although the rise of L2 may affect L1's transaction fee revenue in the short term, in the long run, as the L2 ecosystem flourishes, it will bring more security fees to L1. Only by establishing a prosperous ecosystem that attracts more users and developers can Ethereum achieve true organic growth.

The scaling strategy of Ethereum is forming a multi-layered network structure. This includes vertical L2 and even L3 solutions, as well as horizontal sharding technology and EVM-compatible chains. This three-dimensional scaling architecture is expected to significantly enhance Ethereum's processing capacity, potentially reaching the level of hundreds of thousands of transactions per second in the future.

L2 not only provides scalability for Ethereum but also enhances its competitive advantage. Compared to other public blockchains, L2 solutions offer the security of Ethereum while providing lower fees and higher throughput. This gives the Ethereum ecosystem a favorable position in competition with other public blockchains.

With the development of L2, its transaction volume is expected to surpass Ethereum L1 and most other public chains. This trend may accelerate especially after the implementation of EIP4844. Although it may initially lead to a decrease in L1 transaction activity, as the scale of L2 expands, the fee revenue from L2 will gradually increase.

It is worth noting that the L2 ecosystem will not be dominated by just a few projects. In the future, more L2 solutions may emerge, with 3-5 potentially becoming major players, while there will also be numerous niche L2s catering to specific needs.

Overall, there is a mutually beneficial relationship between Ethereum L1 and L2. L1 provides strong security guarantees and settlement services to L2, while L2 brings more fee income and network effects to L1 by supporting large-scale transaction activities. This synergy not only strengthens Ethereum's market position but also paves the way for its future development.