Bittime - The crypto world is abuzz with predictions of fantastic achievements for Ethereum Layer-2 (L2). The market capitalization value of Ethereum L2 is estimated to reach $1 trillion by the end of 2030.
These predictions are based on a fundamental analysis of five key areas, viewed from the perspective of user experience, developer experience, and technical capabilities.
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Key Areas of Rise in Ethereum Layer-2 Market Capitalization
There are at least 5 key areas in this extraordinary development. The five key areas are:
Developer Experience & User Experience
Both are seen from two different sides, but are equally important. Ease of use is the main highlight, both for developers who want to provide the best products and services, as well as for users who want to make deposits, withdrawals and transactions.
Also read: What is Ethereum (ETH) 2.0 and how is it different from Ethereum
Large Ecosystem
The number of projects active, in development, or planned within the specified virtual boundaries.
Technical Capabilities
Data transmission efficiency, data compression, and proof costs, and more.
Transaction Price
The fees a user incurs to carry out a transaction or series of transactions, depending on their request.
Factors Affecting Transaction Prices
Several factors influence transaction prices, namely data transmission efficiency, data compression, and proof costs. EIP-4844 has succeeded in reducing transaction costs significantly, thereby saving costs for users (ORU).
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Meanwhile, EVM (Ethereum Virtual Machine) compatibility has improved the developer experience. This compatibility allows developers to move some features from Ethereum to L2.
This includes developer libraries, tooling, and smart contract code. This benefits L2 because Ethereum has a large and growing developer base.
Also read: What is the Ethereum Virtual Machine (EVM)?
However, EVM compatibility has limitations for developers who are more familiar with other programming languages.
User Experience at Layer-2
User experience in L2 depends on two things. These two are entering assets and withdrawing assets. Withdrawals in the process have not been a challenge so far.
Next is withdrawing assets, this process can sometimes take time. ORU (optimistic rollup) users may need to wait seven days before their funds can be moved back to Ethereum.
In contrast, ZKU (zero-knowledge rollup) only takes about an hour for the same process.
The level of trust (trust assumption) is divided into two categories: most risky and least risky. Mantle is in the riskiest position, while Arbitrum is the least risky.
This level of confidence determines whether assets can be accessed during network disruptions (outages). Assets cannot be stolen, but users must wait until the issue is resolved. Mint transactions can only occur if a bad actor manages to take over the system.
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The size of the ecosystem determines the token's performance in the market. The more activities users can perform on the blockchain, the greater the value they will gain through transactions. This then impacts native token demand and network effects.
It should be noted, the $1 trillion market cap value for Ethereum L2 by the end of 2030 is just a prediction. The actual value may rise or fall when the time comes.
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You can buy and sell crypto assets in an easy and safe way via Bittime. Bittime is one of the best crypto applications in Indonesia which is officially registered with Bappebti.
To be able to buy crypto assets on Bittime, make sure you have registered and completed identity verification. Apart from that, also make sure that you have sufficient balance by depositing some funds into your wallet. For your information, the minimum purchase of assets on Bittime is IDR 10,000. After that, you can purchase crypto assets in the application.
Learn Complete Guide How to Buy Crypto on Bittime.
Monitor price chart movements of Bitcoin (BTC), Ethereum (ETH), Solana (SOL) and other cryptos to find out today's crypto market trends in real-time on Bittime.
Also read:
What is Ethereum (ETH) 2.0 and how is it different from Ethereum
Ethereum History Story: How Ethereum Became Popular
Ethereum: Towards a New Future with Layer-2 and Ethereum 2.0
DISCLAIMER: This article is informational in nature and is not an offer or invitation to sell or buy any crypto assets. Trading crypto assets is a high-risk activity. Crypto asset prices are volatile, where prices can change significantly from time to time and Bittime is not responsible for changes in fluctuations in crypto asset exchange rates.
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