Layer-2 protocols double their value to over $10 billion eclipsing DeFi market growth
The crypto market has seen a shift in the flow of capital towards the blockchains running atop other blockchains known as Layer-2 solutions. These cha...
- Layer-2 solutions in the crypto market have experienced significant growth, with their value increasing from $5 billion to $10 billion in nine months.
- The total value locked (TVL) in the DeFi market has remained relatively unchanged at $65 billion.
- The growth of Layer-2 solutions can be attributed to platforms like Arbitrum and Base, with Base reaching $500 million in TVL within two months of its launch.
- Layer-2 solutions offer cheaper and faster transactions, attracting investors and gaining support from major players like Coinbase.
- While Layer-2 solutions are part of the DeFi market, they differ in the protocols deployed compared to Layer-1 DeFi chains.
- Base and Arbitrum are among the top Layer-2 solutions, with Base being the third largest and Arbitrum being the largest with $5.3 billion locked.
- Layer-2 solutions have experienced significant growth in TVL compared to Layer-1 DeFi protocols, which have seen little change in the past nine months.
- The emergence of Layer-2 solutions raises concerns about the development of faster and cheaper Layer-1 chains.
The article highlights the significant growth and potential of Layer-2 solutions in the crypto market, particularly in the DeFi sector. It also raises concerns about the stagnation of Layer-1 DeFi protocols and the need for faster and cheaper solutions.