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Why is the emergence of Blast a great blessing for Layer2?

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Blast may not necessarily bring a DeFi Summer like the one in L2, but it will at least accelerate the track to the eve of Summer.

Original author: Haotian (@tmel0211)

Editor's note: Since the founder of Blur launched the Layer2 network Blast this week, the market has received mixed responses. Currently, ordinary users can only participate in Blast and obtain points by "recruiting people" and staking cryptocurrencies. The official announcement is that after the main network goes online in February next year, it will continue to use a model similar to Blur's previous model and issue airdrops based on points. This simple and crude method has also made many crypto users express their love and hate. Crypto researcher Haotian expressed his views on Blast's model and its impact on the Layer2 track on X, which BlockBeats summarized as follows:

Blast's soaring speed of 200 million+ TVL in 2 days really made the entire Layer2 market, which has been sluggish for several months, tremble, and it feels like "the vampire is coming". Task PUA, airdrop bait, to Vitalik's internal roll, etc., Blast's mixing has completely exposed the shameful underwear of Layer2.My point of view: Blast's raid on Layer2 may not be its success, but it must be a great blessing for the Layer2 industry.

Why do you say that? If we reflect on the current situation of the Layer2 industry from a macro perspective, it is not difficult to understand.

1) According to L2beat statistics, there are more than 60 Layer2 projects of various types, involving OP-rollup, ZK-rollup, Validium, Plasma and other categories, but most of these projects are still in the stage of competing in technology Architecture and Narrative. The debates surrounding the OP-rollup and ZK-rollup have been going on for rounds. In the end, technically, ZK-rollup won, and then a large number of ZK-rollup solutions emerged, each with its own characteristics.

Starknet took the lead in realizing the open source and decentralization of the Prover component, and the maximum TPS also exceeded 890,000+. Scoll and Taiko are sought after for their more equivalent EVM, zkSync is praised for its hidden ERC4337 account abstraction experience, and zk+Plasma, which may once again set off a new narrative recently, etc.

VCs are busy and happy, and the money-making party is always on the road to spring ploughing. The Layer2 market presents an unprecedented prosperity of technical narratives, but is this the end game of Layer2 expansion?

2) Putting aside technical factors, and talking about ecology, the two peerless OP-rollup Arbitrum and Optimism have already crushed the ecological advantage and are far ahead. Arbitrum is proud of the number of over 600+ ecological protocols and more than 7B TVL, while zkSync, which is regarded as the end-game rollup, has only 500M TVL after more than half a year of development.

Besides, after the spontaneous Token, Arbitrum has not had much obvious data growth. The meme season led by PEPE did not happen in layer2, and Bitcoin wants to start over and recreate the glory of Layer2 again.

The entire Ethereum layer2 ecosystem has always been stuck at a level that is neither high nor low.

The core reason is rarely discussed. I think it is that Layer2 has not found its own native application stimulus. The three carriages of pure financial applications, DeFi (DEX, lending, Derivatives) cannot drive the growth of the Layer2 ecosystem at all.

Layer2 should be just as its name suggests, attracting long-tail Mass Adoption users who are sensitive to gas fees and user experience UX thresholds. If it is just trying to move financial giants such as Minner, Farmer, scientists, and institutions that have already stabilized the main network.

I'm sorry, compared with performance improvements, they will care more about "security". And the much-criticized Layer2 Sequencer centralized security issue has been quietly rationalized at some point. On the other hand, ZK-rollup, which is more popular in technology, only increases the threshold for developers on the ZK circuit, and there are no killer applications that cannot be used without ZK.

With such an ecological foundation and the lack of stimulation from large capital inflows outside the bull market, Layer2 is destined to be in an embarrassing dilemma where the technical narrative is grand but the ecological implementation is poor.

The market is silently waiting for the arrival of the Cancun upgrade, expecting a significant breakthrough after Cancun. Maybe, unfortunately, Cancun EIP-4844 only made some optimizations on the Gas fee, and cannot directly drive the ecological transition.

3) Let's look at the Stack strategy that the four kings are proud of. From the perspective of long-term narrative construction, Layer2 modularizes core components such as Sequencer and Prover, and uses these shared components to strengthen Layer2 and Layer3 multi-chains. This strategy cannot be said to be wrong, but there is always a sense of being too hasty.

Take zkSync as an example. Its own ecosystem is slow to develop, and it launched the zk-Stack strategy. Suddenly, zkSync has become a part of the ecological application. What a wise move, leaving everything to the developer community. The subtext is that zk-stack is developing slowly, and zkSync is already good as a model chain. After all, there are a group of loyal pay gas users... (%&**&*% omitted here).

Optimism has built a strong reason to build a centralized Sequencer with Op-Stack. After all, it is reasonable to share the Sequencer and build Superchain with the governance ideas of the committee to make up for the lack of decentralized work.

Therefore, the Stack strategy is actually a tricky strategy that avoids the various deficiencies of Layer2's current technology and ecology and abstracts an advanced strategy. Now looking at various Stack strategies, in addition to adding some more grand narratives and integrating scarce developer resources in the industry, C-end users cannot see the sweetness in the short term.

The above.

Returning to the main point of view, in my opinion, it is not an exaggeration to say that Blast's entry into Layer2 is purely a mess.

In the short term, it will drain away the scarce liquidity that other Layer2s already treasure. In the long term, it will make a Layer2 that is in urgent need of building prematurely respect a passive way of lying down and earning. It is no exaggeration to say that it completely violates the original intention of Layer2 to expand the ecosystem.

Blast was poisoned by Paradigm's Web3 Tokenomics economics. Seeing that the Layer2 ecosystem is now lifeless, it tried to stimulate it with a strong medicine.

From the perspective of building Layer2, this starting point is wrong. No matter how high the TVL is and how many users there are, it is just internal consumption of the existing market. Its individual success is not very meaningful, but from the perspective of an industry disruptor, it must be applauded.

It is foreseeable that Blast's disruption may bring two direct effects:

1) Layer2 coin issuance boom. Imagine if Blast drains away most of the market liquidity, what other Layer2 players, who are already unpopular in ZK-rollup, have to choose other than issuing tokens to stimulate traffic? Even if they are not in a hurry, the VCs who have invested heavily behind them will also push hard;

2) Layer2 reshuffle. Needless to say, there are already too many Layer2s in the market. After the shame pants are torn off, the Layer2 industry is bound to accelerate the reshuffle and survival of the fittest. In particular, some quick-made or patchwork Layer2s will be beaten back to their original form, which will open up a new situation for the Layer2 market.

In short, Blast may not necessarily bring a governance token like Compound to Layer2, DeFi Summer, but at least it will accelerate the Layer2 industry to the eve of Summer.