Ethereum layers 2 will be worth $1 trillion by 2030

Key facts:
  • Ethereum will capture 60% of the market for networks specialized in smart contracts, according to VanEck.

  • The value locked in rollups should be multiplied by 125 to arrive at the predicted figure.

Ethereum is the main cryptocurrency network specialized in the execution of smart contracts. One of the problems it has is that operating on Ethereum involves paying high commissions (which can reach tens of dollars) when the network is congested, which usually happens with high frequency.

In order to solve this problem, scalability solutions have been developed in second layersFor example, rollups. Optimism, Arbitrum, zkSync, Base and Starknet are some of the best-known rollups.

Rollups allow the execution of transactions outside the main network (or mainnet) of Ethereumat greater speed and with lower commissions. Subsequently, several transactions together are “wrapped” (rollupin English) and settled in the base layer paying a one-time commission corresponding to the Ethereum validator nodes.

VanEck, an investment and asset management firm, is extremely bullish on the rollup industry. In a recent report he predicts that Ethereum’s second layer scalability solutions will be valued—together—at 1 billion (trillionin English) of dollars by the year 2030.

Valuation of Ethereum’s second layers by 2030, according to VanEck.

Currently, according to data from the on-chain data explorer, DefiLlama, Ethereum rollups have a locked value close to $8 billion with Arbitrum, Blast, Base and Optimism leading the race.

In the following graph, you can see how the capital is distributed in various rollups:

Total value locked in Ethereum rollups. Source: DefiLlama.

Despite his optimism about Ethereum rollups and scalability solutions, VanEck acknowledges that not everyone will continue in the race and be successful. There will be a few who will end up prevailing.

“Overall, we are bearish on the long-term value prospects for most (Ethereum) second layer tokens. (…) There are many solid projects that intend to be launched in the medium term.

VanEck, asset management company.

What does an Ethereum rollup need to be successful?

The investment company detects 5 factors that, in its opinion, will be key to the success (or failure) of scalability solutions on Ethereum.

First of all, mention the transaction costs. This is a critical factor for the user and could be decisive.

The following image, taken from the L2Fees portal, allows you to see what the transaction fees are like in various rollups and also on the Ethereum main network. It does not seem to be a coincidence that the cheapest rollup is precisely the one currently leading the race:

Commissions for operating on various rollups and on the Ethereum main network. Source: l2fees.

Second, VanEck believes that the experience that rollups can give to developers It will be essential to guarantee your success. This implies, for example, that these scalability solutions are fully compatible with the Ethereum Virtual Machine (EVM) that allows the execution of advanced smart contracts.

The user experience is not left behind. For the investment company, it is essential that layers 2 of Ethereum allow for fluid operations, seamless transactions, etc. This could determine the success or failure of a rollup.

As point number 4, VanEck highlights the importance of users being able to feel that operate in an environment of trust. This means an ecosystem that has implemented corresponding measures to prevent vulnerabilities and attacks.

Finally, ecosystem size is important. A cryptocurrency network with a lot of value locked indicates that there are investment opportunities there, that there is a high degree of trust, that there are many developments, etc. Therefore, ecosystems with more money invested in them have a greater chance of succeeding, in general, than smaller ecosystems.

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