NewsBTC
9 hour ago
1 0

BULLISH 📈 : Vitalik Reframes Ethereum L2 as ETF Inflows Rise

Ethereum Scaling and Layer-2 Networks:

  • Ethereum co-founder Vitalik Buterin suggests rethinking the role of layer-2 (L2) networks as Ethereum's base layer scales effectively.
  • Recent protocol upgrades have increased Layer 1 throughput and reduced fees, making direct mainnet usage more attractive.
  • Data indicates a sharp increase in monthly active addresses on Ethereum L1, while L2 usage has declined.
  • L2s have struggled with decentralization, often retaining centralized controls for operational or regulatory reasons.
  • Buterin emphasizes that L2s should be seen as a spectrum, varying from tightly secured by Ethereum to independent systems interoperating when needed.
  • Progress toward native rollups is highlighted, with proposals for zero-knowledge EVM proofs at the protocol level to simplify interoperability.

Ethereum ETH

ETF Inflows and Market Context:

  • Ethereum spot ETFs recorded a net inflow of around $14 million, led by BlackRock’s ETHA fund, reversing recent outflows.
  • The return of ETF inflows reflects continued interest in Ethereum as its base layer strengthens.

Future of L2 Networks:

  • L2 builders are encouraged to specialize beyond just offering lower fees.
  • Future relevance may depend on factors such as privacy-focused execution, application-specific chains, ultra-low-latency systems, or non-financial use cases like identity and AI.