Layer-2 projects built on the Ethereum blockchain, such as Polygon, have been experiencing a surge in on-chain activity. According to IntoTheBlock, transactions on these networks have reached 32 million every week since the Dencun upgrade. However, it’s important to note that these transactions include not only Polygon but also Base, Arbitrum, and Optimism.
The Dencun upgrade, which was finalized on March 13th, helped to lower costs on Layer-2 networks, thus driving the increase in activity. This has been a significant development as new entrants no longer need to worry regarding high gas fees. The rise in activity is a clear indication that the objectives of the upgrade were successful.
When analyzing the data, it is evident that Polygon leads in several metrics, but Base closely follows. For example, on April 5th, Polygon had 4 million transactions, while Base had 3 million. Arbitrum and Optimism recorded 1.5 million and 801,400 transactions, respectively. Interestingly, despite Polygon’s higher transaction numbers, Base generated more fees.
One significant factor behind the network’s dominance is the presence of meme coins such as Brett (BRETT) and Toshi (TOSHI) built on Base. Brett is considered Pepe’s best friend on the Base chain, while Toshi represents Brian Armstrong’s cat. Over the past 30 days, Brett’s price has increased by 79.18%, with a market cap of $592 million. Similarly, Toshi’s price has jumped by 46.51% within the same period, with a market cap of just over $179 million. These numbers indicate the potential for even higher prices and market caps in the future, which might further drive the total L2 transactions on Ethereum.
However, when it comes to active addresses, the dynamics shift. Data from Santiment reveals that Polygon had 2,133 active addresses in a 24-hour period, while Arbitrum had 15,500 and Optimism had 10,000. It’s important to note that all of these metrics showed a decrease. Comparing this decline in activity with the transaction count, it becomes evident that fewer market participants were involved in higher transactions from Polygon’s end.
Looking ahead, network activity on Ethereum Layer-2s might experience a temporary drop as user interaction decreases. However, if the market recovers from its current “onlooking” mode, changes are likely to occur. In such a scenario, the number of active users is expected to improve, potentially surpassing the 32 million weekly transactions recorded thus far.
These developments in Layer-2 activity have significant implications for the industry. The surge in on-chain transactions indicates a growing interest in using Layer-2 solutions to overcome the scalability issues faced by the Ethereum network. As more projects are built on Layer-2 and user adoption increases, the potential for innovation and growth in the space becomes even more significant.
It is worth noting that the future of Layer-2 solutions is not without challenges. Scalability, security, and interoperability will remain key areas of focus for developers and industry participants. Additionally, regulatory considerations and market dynamics will play a crucial role in shaping the future trends of Layer-2 solutions.
In conclusion, the recent surge in on-chain activity for Layer-2 projects on the Ethereum blockchain, particularly Polygon, signifies a promising future for scalable solutions. As the ecosystem continues to evolve, it is crucial for developers, investors, and users to stay informed and adapt to the changing landscape. The rise of meme coins on Layer-2 networks adds an element of excitement and potential for further growth. With careful attention to scalability, security, and regulatory considerations, Layer-2 solutions have the potential to revolutionize the blockchain industry and drive mass adoption.
