Why the Endgame of Celestia Invading Ethereum Layer 2 Could Be a "Win-Win"?
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Why the Endgame of Celestia Invading Ethereum Layer 2 Could Be a "Win-Win"?
Essentially, this is an inevitable outcome of the high modularity in the Layer2 market.
Navigating Web3 tides with focused insightsAuthor: Haotian
How should we understand @CelestiaOrg's threat to Ethereum—will it truly become an "Ethereum killer"? In my view, Celestia's invasion will continue unfolding within the Layer 2 space, but the outcome of this battle won’t be a zero-sum game; instead, it may lead to a "win-win" scenario.
This is essentially an inevitable result of high modularity in the Layer 2 market. Why? Let me explain my perspective.
If we break down the Ethereum blockchain system, there are two core components:
1) Data Availability (DA); 2) Interoperability. While other layers like the EVM execution layer and PoS consensus layer are also important, when discussing Rollup-based Layer 2 solutions, DA and interoperability are what matter most.
DA corresponds to Ethereum validators’ verification capability. If Ethereum handles DA, then mainnet validators can verify state transition processes submitted by Layer 2s to ensure security. But if Ethereum’s DA function is stripped away, calldata and Blob blocks on the mainnet become mere bulletin boards for Layer 2 state updates—the validity of which would then depend on third-party DA consensus. Even if malicious data ("bad debt") is deliberately submitted, the mainnet would have no ability to detect or intervene.
Interoperability refers to Ethereum’s ability to communicate with other chains, primarily involving secure cross-chain asset settlement and effective liquidity bridging solutions. Currently, projects like @eigenlayer (via restaking) and various middle-layer liquidity management protocols play key roles here.
These liquidity management solutions not only reinforce Ethereum’s position as a dominant settlement layer, but also help offload its overloaded consensus burden into multi-chain environments. Crucially, they allow Ethereum’s validator security consensus to be extended to other chains, opening up new frontiers for the foundation of Ethereum’s DeFi brand.
As one of the pioneers of modular blockchains, Celestia should logically target Cosmos IBC-based chains as its primary focus—after all, most IBC-linked chains emphasize lightweight design, making Celestia-based DA a perfect fit.
Yet, Celestia has taken an unconventional path, launching Blobstream—a solution aimed at the Ethereum ecosystem—that acts as an external force continuously infiltrating Ethereum. Combined with the internal pressure from Ethereum Layer 2s using OP Stack to rapidly spin up new chains, Celestia has effectively expanded its reach and steadily encroached upon Ethereum’s Layer 2 territory.
For Layer 2 developers, the choice boils down to a tradeoff between DA orthodoxy and chain deployment cost.
DA orthodoxy tends to be less commercially aggressive. It suits projects that prioritize security consensus, possess strong branding, and already have market traction—typically established, full-featured Layer 2 platforms. On the other hand, newer, smaller Layer 2s—especially those quickly launched via OP Stack—will go to great lengths to minimize costs.
Thus, third-party DA providers like Celestia naturally become more attractive options. Although EigenDA offers Ethereum-based DA services, it doesn't significantly reduce actual development costs for project teams building Layer 2s.
For developers seeking shortcuts in operating Layer 2s, cost will inevitably be the top priority. The biggest expense in running a Layer 2 lies in Ethereum’s DA fees. Offsetting early operational revenue pressure through low-cost third-party DA solutions may become the preferred route for most small, tail-end developers.
Therefore, whether Celestia poses a real threat to Ethereum hinges on the future trajectory of Ethereum’s Layer 2 ecosystem. If Layer 2 consolidation centers around a few major players—the so-called “Four Heavenly Kings”—then DA orthodoxy will dominate. But if Layer 2 proliferation leads to a boom of diverse solutions emerging rapidly, then cost efficiency will remain the hard truth.
There’s still the variable of the upcoming Cancun upgrade, but the trend for Ethereum Layer 2s is already clear: a large wave of new Layer 2 solutions is imminent. This isn’t difficult to understand:
The “Four Heavenly Kings”—Arbitrum, Optimism, Starknet, zkSync—have underperformed expectations. Issues such as sequencer centralization, the unimplemented 7-day challenge window, hardware acceleration bottlenecks in Prover systems, incomplete EVM equivalence, lack of reliable cross-chain escape hatches, token economic models failing to empower governance tokens, and struggles in developing native DeFi ecosystems—all persist.
To put it plainly, Layer 2 development has left behind a mountain of unresolved issues. Each of these problems, when paired with new stack frameworks and Celestia’s DA, could become a compelling narrative with significant investment appeal.
As I’ve said in previous articles, the real chaos in the Layer 2 space will only begin after the Cancun upgrade, leading to a diversified form of prosperity. Moreover, with OP Stack and ZK Stack paving the way toward a more open and inclusive era of Layer 3 app-chains, the traditional boundaries of Ethereum Layer 2s will blur further, making third-party DA providers like Celestia a necessity.
This diversification is an inevitable step in the commercial expansion of the Layer 2赛道, and it’s precisely why Celestia remains relentlessly ambitious toward Ethereum’s Layer 2 ecosystem.
However, this isn’t purely a threat to Ethereum. As more and more Layer 2s adopt third-party DA solutions like Celestia, while Celestia’s market position strengthens, it will simultaneously trigger transformations within Ethereum’s Layer 2 landscape:
1) General-purpose Layer 2 platforms will solidify their foundational role, dominating in liquidity, user base, and application ecosystems. DA orthodoxy will become a key differentiator securing their entrenched positions;
2) Innovative, niche Layer 2 platforms will drive expansion, attracting explorers and investors with novel features, diverse use cases, and promising market narratives. Flexibility and freedom will be their strongest cards.
With this framework in mind, Ethereum’s core Layer 2s will grow increasingly stable. Ethereum’s dominance in DA will remain unshaken. Meanwhile, even though some flexible Layer 2s or Layer 3s may rely on non-Ethereum DA, don’t forget: as long as they’re built atop Ethereum stacks, they’ll struggle to escape Ethereum’s control over interoperability.
Eventually, Ethereum—as the primary settlement layer and source of liquidity—will exert softer, yet powerful, liquidity influence over these flexible Layer 2s.
If you don’t grasp what I mean, just look at Celestia: despite its sky-high price, it hosts shockingly few transactions. As Celestia invades Ethereum’s domain, it gradually loses its attribute as a “general-purpose chain” (which it never really was), becoming instead a modular DA layer within Ethereum’s broader ecosystem. So what if many Ethereum Layer 2s adopt Celestia’s DA? As long as the Stack and Rollup architecture remains unchanged, these Layer 2s will keep paying continuous “taxes” to Ethereum.
Compared to the loss of DA orthodoxy, the rise of a diversified, thriving Layer 2 and Layer 3 market means Ethereum ultimately stands to gain the most.
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Haotian | CryptoInsight
