Ethereum's 'Parasitic' Relationship with L2s: Expert's Take

  • Justin Bons warns Layer 2 solutions are overtaking Ethereum.

  • Bons criticizes Ethereum’s governance and cites centralization issues.

  • He suggests that L2 dominance may signal the decline of Ethereum.

Cyber Capital founder Justin Bons shared a critical outlook on Ethereum’s future, claiming that the platform is “dying” while Layer-2 (L2) solutions gain traction. Bons contends that Ethereum’s inability to handle high transaction volumes and fees has pushed users towards L2s, creating what he calls a “parasitic relationship” where L2s thrive at Ethereum’s expense.

1/9) Ethereum is dying while L2's dance on its grave

ETH cannot sustain high fee revenue because it lacks the capacity

At the same time, L2s are seeing record highs in usage & fees while they lobby to keep ETH's capacity down!

That is what makes it a parasitic relationship: 🧵

— Justin Bons (@Justin_Bons) August 26, 2024

Bons argues that Ethereum’s fee revenue has plummeted since the implementation of EIP-4844, as L2s have begun capturing the majority of fees. This change has resulted in increased inflation within the Ethereum network, making it even more vulnerable.

Additionally, Bons points…

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