Odaily Planet Daily News: Zeta Markets co-founder Anmol Singh said that as the demand for faster and more scalable solutions continues to increase, the limitations of the underlying infrastructure of the Ethereum mainnet are driving users, applications and capital to turn to L2 solutions and competing blockchains such as Solana. Singh said: "Ethereum L2 emerged because the underlying infrastructure is not sufficient to handle users, transactions and data, and users and capital are migrating to L2 and other L1s out of necessity." Qi Zhou, founder of QuarkChain and EthStorage, said that the increase in the number of Ethereum L2 solutions may lead to a split in liquidity between different chains, affecting the entire ecosystem. "Each L2 network, such as Arbitrum, Optimism and zkSync, has its own independent liquidity pool, which leads to fragmentation. Users usually need to bridge assets between L2s, which increases friction and transaction costs. This dispersion dilutes liquidity and makes it more difficult to achieve deep liquidity pools in any single ecosystem. As liquidity is dispersed, there is a risk of reduced market efficiency, increased slippage and increased large transaction fees, which may prevent users from participating in L2." However, Zhou pointed out potential solutions that can offset the fragmentation of Ethereum liquidity: "Such protocols are emerging to provide cross-L2 liquidity, allowing assets to flow seamlessly between L2s and reduce fragmentation." He said that solutions like Ethereum's native L2 rollup-to-rollup transfers or shared liquidity centers can help aggregate liquidity and make it available on L2 He added: “As the ecosystem grows, striking a balance between scalability, liquidity concentration, and user experience is critical for Ethereum L2 to maximize adoption and utility.” (The Block)

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