Blast attracted more than $200 million in Total Value Locked (TVL) in just two days at an astonishing speed, like a stream of fresh air that hit the entire Layer2 market that had been in a slump for several months, like a "vampire descending". From task-based incentives, airdrop bait, to Vitalik-style involution, Blast has mixed and matched so much that it has fully displayed the trump cards of Layer2. I have a view that the emergence of @Blast_L2 may not be a dazzling move for Layer2, but it is a great blessing for the Layer2 industry.
Why do we say this? If we reflect on the current situation of the Layer2 industry from a macro perspective, we may be able to understand the reason.
1) According to statistics from L2beat, there are already more than 60 Layer2 projects of various types, covering multiple categories such as Optimistic Rollup, Zero-Knowledge Rollup, Validium, Plasma, etc. However, most projects are still in the stage of technical architecture and narrative construction, and rounds of debates have been launched around the dispute between Optimistic Rollup and Zero-Knowledge Rollup. In the end, from a technical point of view, Zero-Knowledge Rollup won, and then a large number of Zero-Knowledge Rollup solutions with their own characteristics emerged.
Starknet is the first to realize the open source and decentralization of the Prover component, with a maximum TPS of over 890,000+. Scoll and Taiko are sought after for their more equivalent EVM. zkSync is highly praised for its hidden ERC4337 account abstraction experience, and zk+Plasma, which may recently set off a new narrative again, etc.
VCs are busy and happy, and the Layer2 market is experiencing an unprecedented boom in technology narratives. However, is this the ultimate goal of Layer2 expansion?
2) Apart from technical factors, from an ecological perspective, Arbitrum and Optimism, the absolute leaders of Optimistic Rollup, have already crushed other projects and have unattainable ecological advantages. Arbitrum stands out with more than 600 ecological protocols and a TVL of more than $700 million, while zkSync, which is regarded as the ultimate choice of Rollup, has been developed for more than half a year, and its TVL is only $500 million.
Moreover, Arbitrum’s data has not grown significantly since the creation of the token. The meme season led by PEPE did not happen in Layer 2, and it is even more difficult for Bitcoin to rebuild the glory of Layer 2.
The entire Ethereum Layer2 ecosystem has always been in a highly stalemate.
I think the core reason that few people discuss is that Layer2 has not found its own direction of strong application stimulation. The three pillars of pure financial applications and DeFi (DEX, lending, Derivatives) cannot promote the growth of the Layer2 ecosystem at all.
Layer2 should attract long-tail Mass Adoption users who are sensitive to gas fees and user experience thresholds. If you only try to migrate financial giants such as miners, farmers, scientists, and institutions that are already stable on the main network, it is a pity that they care more about "security" than performance improvements. The much-criticized Layer2 Sequencer centralized security issue has been quietly rationalized. On the other hand, the more technically respected Zero-Knowledge Rollup has only increased the threshold for developers on the Zero-Knowledge circuit, and there are no powerful applications that cannot be separated from Zero-Knowledge.
On such an ecological foundation, without the stimulation of large capital influx, Layer2 is destined to fall into the embarrassing situation where the technical narrative is grand but the ecology cannot be implemented.
The market is lurking in anticipation of the Cancun upgrade, hoping that Cancun will bring about a significant breakthrough. Unfortunately, however, Cancun EIP-4844 only makes some optimizations on the Gas fee and cannot directly promote the leap of the ecosystem.
3) Let’s look at the Stack strategy that the four big guys are proud of. From the perspective of long-term narrative construction, Layer2 modularizes the core components such as Sequencer and Prover, and uses these shared components to expand Layer2 and Layer3 multi-chains. This strategy may be good, but there is always a sense of haste.
Optimism has built a strong argument for building a centralized sequencer with Op-Stack. After all, it is reasonable to share the sequencer and build a Superchain with the governance idea of the committee to make up for the lack of decentralized work.
Therefore, the Stack strategy is actually a tricky strategy that avoids the shortcomings of Layer2's current technology and ecology and abstracts an advanced strategy. Looking at various Stack strategies today, apart from adding some grander narratives and integrating scarce developer resources in the industry, ordinary users cannot see any benefits in the short term.
Overall, from my point of view, it is no exaggeration to say that Blast's entry into Layer2 is purely disruptive.
In the short term, it may deprive other Layer2s of scarce liquidity that they already treasure. In the long run, it is no exaggeration to say that it completely goes against the original intention of Layer2 to expand the ecosystem if a Layer2 that is in urgent need of construction prematurely advocates a passive way of making money.
Blast is like being poisoned by Paradigm's Web3 Tokenomics economics. Seeing that the Layer2 ecosystem is currently lifeless, it tries to stimulate it with a powerful dose of medicine.
From the perspective of building Layer 2, this starting point is wrong. No matter how high the TVL is or how large the number of users is, this is just internal friction in the existing market, and its individual success does not mean much. But from the perspective of an industry disruptor, it should be applauded.
It is foreseeable that Blast's disruption may have two direct impacts:
1) The wave of Layer2 token issuance. Imagine if Blast took away most of the market liquidity, what other Layer2 players with Zero-Knowledge Rollup, which are already relatively unpopular, would have other options except issuing tokens to stimulate traffic? Even if they are not in a hurry, the VCs who have invested heavily behind them will push hard;
2) Layer2 reshuffle: It goes without saying that there are too many Layer2s in the market. After the veil is lifted, the Layer2 industry is bound to accelerate the reshuffle and the survival of the fittest. In particular, some quick-made or patchwork Layer2s will be brought back to their original form, which will open up a brand new situation for the Layer2 market.
In short, Blast will not necessarily bring Layer2 compound growth similar to the DeFi governance token summer, but at least it will accelerate the Layer2 industry to the eve of summer.
