Close Menu
    Ethereum

    Ethereum L2 networks hit record $51.5 billion, raising concerns over main network’s profitability

    By No Comments2 Mins Read

    30s Summary

    Ethereum’s second layer (L2) networks have reached a record value of $51.5 billion, a 205% increase from $16.6 billion in November 2023. These L2 networks boost Ethereum’s transaction capacity and speed. However, some experts fear they could reduce the main network’s profitability and impact the Ether cryptocurrency’s price. Arbitrum One and Base are leading this surge with $18.3 billion and $11.4 billion locked-in value respectively. Ethereum’s latest update, Dencun, has also bolstered the L2 networks, stabilising fees and expanding capacity and scale.

    Full Article

    The Ethereum world is getting more interesting and valuable for investors who are pumping more money into the scene. The second layer (L2) networks of Ethereum, which are basically networks that help Ethereum function better and faster, have reached a record value of $51.5 billion. That’s a whopping increase of over 205% from just $16.6 billion in November 2023.

    L2 solutions are a pretty important part of Ethereum’s system. They help Ethereum to deal with more transactions by processing them on different chains, which ultimately reduces the cost and time it takes to use the Ethereum network.

    But it’s not all rosy – some experts are worried that these L2 networks can actually take away from the “profits” of the main Ethereum network, which could affect the price of the Ethereum cryptocurrency, Ether.

    Right now, there are two networks leading this increase in second layer value – Arbitrum One and Base. Together, they’ve driven the total value up to over $51 billion. Arbitrum is the leader of the L2 pack with over $18.3 billion locked-in value. Base isn’t too far behind, holding $11.4 billion. Both networks saw a significant increase in value over the week leading up to November 28th.

    In fact, Base set a new record on November 26th by processing 106 transactions per second and exceeding the $10 billion mark for the first time. This mainly happened due to a surge in transactions involving “meme” cryptocurrencies.

    The Ethereum L2 networks also got a big boost from Ethereum’s latest update, named Dencun. This major upgrade was a big step towards stable fees for the L2s. It however wasn’t just about lowering fees like most people think, but more about expanding capacity and scale according to Fuel Labs’ CEO.

    Related Posts