Ethereum Layer 2 Sees Drop in Activity Post Airdrop

Ethereum’s main layer has seen a 25% increase in active addresses and a 20% rise in transaction volume over the past year, while some layer two networks experience declines.

The differential growth between Ethereum’s main network and layer two solutions highlights shifting market dynamics, impacting investor strategies and the scalability discussions surrounding Ethereum’s future development.

Layer 2 Networks Experience 90% Drop in Activity

Ethereum’s main network has reported an increase in active addresses by 25%, complemented by a 20% rise in transaction volume over the past twelve months. However, layer two networks are facing challenges. In the aftermath of various airdrops, platforms such as Ronin and ZKsync saw active users and transaction volumes decline significantly. Nansen data reveals a dramatic 70% drop in the number of active addresses on Ronin.

As a result of these shifts, Ronin and ZKsync witnessed substantial reductions in activity. ZKsync, for instance, experienced a 90% decrease in trading volume. This has raised concerns over the long-term sustainability and utility of such layer 2 solutions post-airdrop fervor.

Market feedback has been mixed, with some analysts, like Vitalik Buterin, echoing the importance of layer 2 solutions for Ethereum’s growth. Despite optimism from key figures, community discussions indicate a cautious sentiment about future developments in the ecosystem.

Scalability solutions like Layer 2s are crucial for Ethereum’s future growth. — Vitalik Buterin, Co-founder of Ethereum

Ethereum’s Layer 1 Surges 25% Amid Layer 2 Decline

Did you know? The Ethereum base layer’s user activity has grown by 25% in the last year, contrasting with significant post-airdrop decreases in activity on networks like Ronin and ZKsync.

Ethereum’s performance has been steady despite market fluctuations, with CoinMarketCap placing ETH’s market cap at $356.62 billion and a 24-hour trading volume of $23.46 billion. Recent price movements witnessed ETH dropping by 11.20% over the past week.

Insights from Coincu suggest that the stagnation in activity on certain layer 2 networks may lead to re-evaluations of scalability measures. Analysts indicate that while challenges exist, strategic technological advancements could stabilize network usage moving forward.