Ethereum Layer-2 Solutions Are Here to Stay

L2 & Eth2 are BFFs, not frenemies

Whenever I’m singing the praises of Polygon, there’s always someone that asks the question: “But what happens when Ethereum 2.0 comes out?”

And it’s a good question.

Polygon’s Matic network is a proof-of-stake Ethereum sidechain. It’s important because it addresses Ethereum’s biggest problems: transaction fees and scalability. Essentially, you pay a single Ethereum fee to migrate your assets from the Ethereum layer-1 (L1) network to the Matic layer-2 (L2) network. Then you can transact quickly and cheaply using MATIC tokens to pay gas fees instead of ether.

However, Ethereum 2.0 aims to bring proof-of-stake to the L1 network, dramatically reducing transaction fees and increasing TPS from 25 to 100k. That’s the root of the confusion. If L2 solutions fix Ethereum’s problems, and Eth2 also fixes Ethereum’s problems, why wouldn’t Eth2 mark the end of the need for L2s?

To adequately address the answer, we must first understand what constitutes a “layer-2 solution.” Vitalik Buterin does a nice job of breaking this down for us in his article An Incomplete Guide to Rollups, where he says the following:

The three major types of layer-2 scaling are state channels, Plasma and rollups. They are three different paradigms, with different strengths and weaknesses, and at this point we are fairly confident that all layer-2 scaling falls into roughly these three categories

So, right away, we can draw three observations. First, all three solutions have valid use cases due to their different strengths and weaknesses. Second, L2 solutions can provide 100x scaling today without eth2. And, finally, the long-term vision of 100k TPS is reliant on rollups, i.e., layer-2.

This provides us with an obvious indication that L2 is part of the greater Ethereum-2.0-&-beyond vision. And not just as something that can continue to co-exist, either, but as an integral component. If we read between the lines a bit, though, it does seem that rollups are the favored variety on Vitalik’s roadmap — so what does that mean for sidechains like Matic?

We can, once again, turn to Vitalik, this time on Reddit, responding to a question about L2 relevance:

But fully off-chain L2s based on channels and Plasma will continue to be relevant; the above schemes can theoretically go up to ~100–500k TPS, but an ecosystem where Ethereum covers the world could easily have need for even more, especially for micropayment-oriented applications.

This response gives us more clear evidence that L2 channel and Plasma solutions bring a potential 5x increase in TPS over the current projection for Eth2, which, as mentioned previously, already depends on L2 rollups!

It is undeniable that L2 solutions will continue to play a critical role in the scalability of the Ethereum network. To come full circle, it also underscores exactly why I’m so big on Polygon. They aren’t just a sidechain; their goal is to provide an array of solutions to meet the various needs of different projects. Currently, only the Matic network and Plasma bridge are live, but they are working on zk rollups, optimistic rollups, stand-alone chains, and shared security chains.

It also supports my perspective that the future is cross-chain, that projects work better when they work together, and that the cross-chainiest, work-togetheriest projects will be the ones that win. Eth2 will make sidechains like Matic or alternatives like Harmony even more accessible, which gives us all more freedom and choice, which everybody can agree is good.

We’re barely scratching the surface of mainstream adoption, and we’re sure to see more scalability pain as it grows. There is no one solution to the problem. We need multiple solutions working together. That’s the vision for L2 and Eth2, and that’s why L2 isn’t going away any time soon.

Source: https://medium.com/this-crypto-life/ethereum-layer-2-solutions-are-here-to-stay-e0912130813d?source=rss——-8—————–cryptocurrency