Author: Nuffle Labs CEO Altan Tutar, CoinDesk; Translated by: Deng Tong, Golden Finance
In the past year, the crypto industry has seen exponential growth in users, with monthly active addresses increasing from 70 million in 2023 to over 220 million in 2024, doubling in size. More than 300 chains are currently online, and the ecosystem should be able to meet the demands of users sustainably. However, within this vast ecosystem, most activity and liquidity are locked within multiple Ethereum Layer 2 solutions.
In its current state, Ethereum evokes the early 1500s in Europe, which experienced breakthroughs like the printing press and advanced shipbuilding that enhanced resource management. Today, Ethereum's thriving DeFi ecosystem is equipped with primitives like lending, staking, and re-staking. However, just as Europe faced challenges of resource scarcity and overuse, Ethereum also faces obstacles in enabling other assets to thrive in its home (Layer 1).
Therefore, the current blockchain ecosystem remains fragmented and frustrating. While chain abstraction has become a trend, and many projects have made progress, solutions like intent often involve sorters that favor large participants when filling orders between blockchains, leading to centralization. Additionally, no extra utility has been created for users, as most solutions focus simply on swapping assets.
Despite having an impressive technological foundation, we have created an environment where digital assets are constrained rather than empowered. Top blockchain resources like Ethereum are underutilized and restricted by rigid architectural boundaries.
To achieve true interoperability by 2025, we must take a step back and re-examine blockchain modularity from a fresh perspective.
The Illusion of Modularity
The common analogy of comparing blockchain to 'LEGO blocks' oversimplifies the complex technological landscape. Unlike unified building blocks, blockchain components are complex systems with specific dependencies and intricate interoperability challenges.
Consider a practical scenario: transferring assets between different blockchain networks should be simple. However, current solutions (like basic token swaps) offer very limited functionality. The technology requires a more nuanced and complex approach.
Emerging technologies are changing this narrative. Advances in universal messaging alternatives and transaction finality are creating a more organic and unified ecosystem. The ultimate goal is not just to connect different parts but to create an infrastructure that enables different networks to collaborate easily.
2025: The Year of Usability and Accessibility
Looking ahead to 2025, I expect a dual approach to tackle the current and future fragmentation issues. To attract users and build a sustainable user base, infrastructure should be seamlessly integrated into the background so users can focus on the application itself without getting bogged down by the technology behind it.
Currently, users are unable to optimally utilize their assets due to complex bridging solutions hindering easy cross-chain asset transfers. Instead, we need to provide users with a way to maximize their returns while contributing to the ecosystem. This can be achieved by allowing token holders to freely transfer their assets from one chain to another through solutions like re-staking without the need for bridging. As re-staking expands to connect multiple Layer 1 and Layer 2 networks beyond Ethereum, this is an area of growing interest for users.
Projects will focus on enhancing and interconnecting existing infrastructure rather than dividing the ecosystem with new, competitive blockchains. This approach will breathe new life into currently dormant chains, driving activity and creating real value.
In addition to improvements in underlying infrastructure, user experience will also become a focal point. We will see applications seamlessly integrate blockchain functionalities, allowing users to interact with complex technologies without being aware of their intricacies. The infrastructure will become invisible—a robust backend that complements a smooth frontend experience without technical friction.
Creating a Global Marketplace
While 2024 marks a year of widespread acceptance for the industry, as evidenced by increased investments in assets like Bitcoin, true adoption requires an inclusive vision. We should not only build financial tools but also create a globally interconnected marketplace that allows every asset to reach its full potential.
The future of blockchain is not about each chain vying for dominance. It is about creating a collaborative, fluid infrastructure that empowers users to unlock their economic potential by building the future of currency and value.
