Andre Cronje Criticizes Appchains: High Costs and Liquidity Challenges

Andre Cronje, co-founder of Sonic Labs, has criticized layer-2 (L2) appchains, arguing that they are impractical for builders.

In an October 13 post on X, Cronje expressed concerns about high infrastructure costs, fragmented liquidity, and inadequate support for developers. He argued that these challenges hinder the widespread adoption of appchains.

Appchains are custom blockchains designed to meet the specific needs of decentralized applications (DApps) or a certain set of functions.

Cryptocurrencies, Applications, Layer2

Source: Andre Cronje

Cost and support: Cronje faces Hilmar

Cronje primarily criticized the high costs of deploying and maintaining appchains. Infrastructure costs like regulatory compliance and oracles add up quickly, he said.

He shared that his team’s infrastructure costs this year have reached $14 million. He noted that many of these recurring costs make it difficult for developers to focus on core applications and users.

Hilmar Orth, founder of Gelato Network, disagrees with Cronje’s assessment. Orth argues that the necessary infrastructure is now easily accessible through rollup-as-a-service (RaaS) providers.

Orth argues that developers don’t need to build infrastructure from scratch, pointing to support from existing frameworks and RaaS providers. He counters Cronje’s isolation concerns, asserting that support for appchains is readily available.

Cryptocurrencies, Applications, Layer2

Source: Hilmar

Liquidity and Safety: Cronje vs Boiron

Cronje is also concerned about liquidity fragmentation in appchains, arguing that liquidity is forced onto bridges, which are “centralized and vulnerable to attack.”

Marc Boiron, CEO of Polygon Labs, introduced AggLayer as a solution that could solve many of these liquidity problems by creating an interoperable network that links appchains.

Boiron's perspective offers an optimistic view of appchain liquidity management if made transferable between multiple Chains, effectively minimizing the risk of fragmentation.

Orth echoed this optimism, asserting that rollups come with built-in bridges and market makers, and “faster zk proofs” that optimize the movement of funds.

Cryptocurrencies, Applications, Layer2

Source: Marc Boiron

Debating community and network effects

Cronje also claims that L2, as appchains, does not have a “community of users or builders,” reducing the network effects needed for appchains to thrive.

Boiron disagrees, arguing that the community and network effects are still strong, adding that there are “a lot of friends” contributing to AggLayer as community members to “help grow the pie.”

Hilmar also disputed both Cronje and Boiron’s community statements, saying that builders are often “competing for users and not friends. That’s the reality.”

The ongoing debate between Cronje, Orth, and Boiron continues to gain traction on X, highlighting the divide in opinion on L2 as an appchain.

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