How to objectively evaluate Ethereum's Layer 2 strategy?
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How to objectively evaluate Ethereum's Layer 2 strategy?
All the pain points have converged on Layer 2's urgent need for user and ecosystem growth.
Navigating Web3 tides with focused insightsBy Haotian
Recently, FUD around Ethereum and @VitalikButerin has been growing louder. In particular, overseas KOLs have had some fascinating discussions on topics like blob space utilization and Layer2 revenue. Setting aside the emotional swings of secondary market sentiment, how should we objectively evaluate Ethereum's Layer2 strategy based purely on data? Here’s my take:
Let’s rewind to before Ethereum’s Cancun upgrade. Back then, there was huge excitement about Rollup-as-a-Service (RaaS) and the "DA War." The idea was that one-click rollup deployment would lead to a surge of new Layer2 chains, dramatically increasing demand for Ethereum’s data availability (DA) capacity. This would trigger fierce competition for blob space, drive up blob pricing through a fee market frenzy, burn large amounts of ETH in the process, shift Ethereum from inflationary to deflationary, and ultimately boost ETH’s price—everyone wins.
In reality, however, this grand narrative around RaaS fizzled out shortly after the Cancun upgrade. While the foundational infrastructure for one-click chain deployment is now in place, far fewer developers have launched chains than expected. There simply isn’t enough competitive pressure yet.
1) Blob space utilization remains suboptimal—currently averaging around 80%. Layer2 teams can optimize their blob usage by choosing whether to post data in a given block. For instance, they can monitor real-time blob utilization and skip posting if congestion is high, delaying until the next block. This behavior prevents the blob fee market from becoming FOMO-driven or highly competitive.
2) The current blob usage fees—and thus DA costs for Layer2 projects—account for only about 0.3% of their total revenue. Layer2 projects collectively earn roughly $500,000 per day, while their blob cost is just a tiny fraction of that. Clearly, we’re nowhere near saturation. Although Layer2 operators do face other costs (e.g., sequencer servers, prover infrastructure), the visible DA cost remains negligible.
This shows that Ethereum succeeded remarkably in reducing fees post-Cancun. But it also reveals a deeper issue: current user activity and transaction volume on Layer2 are insufficient to meaningfully feed value back to Layer1. So where’s the much-anticipated “deflationary expectation”?
In the short term, data suggests Ethereum’s rollup-centric roadmap has been largely successful. DA costs have dropped significantly, allowing Layer2 teams to scale ecosystems affordably. End users now enjoy near-negligible gas fees on Layer2 (ranging from $0.001 to $0.01).
A significant portion of users now treat Layer2 as their primary chain for high-frequency transactions. Isn’t the core goal of Ethereum’s rollup strategy precisely to position Layer2 as the go-to solution—low fees, smooth UX, high TPS? From this perspective, Ethereum’s Layer2 strategy has clearly succeeded—at least so far.
But what happens in the long run, when Layer2 transaction volume grows exponentially and blob space utilization reaches sustained highs?
DA costs will rise. Even though today’s 0.3% ratio leaves room for growth, once DA expenses exceed 50% of a project’s revenue, many Layer2s will likely opt out of competing for Ethereum’s blob space. At that point, demand for third-party DA providers like Celestia would begin to surge. Meanwhile, some Layer2 projects may evolve into Layer3s or adopt Validium-style architectures, enriching the overall diversity of Ethereum’s rollup ecosystem.
Here’s the irony: does the original narrative and hype around Ethereum’s Layer2 stack collapse precisely because the Cancun upgrade worked *too well*? Yes—exactly.
With blob utilization still unsaturated and no real fee market dynamics emerging, all pressure now shifts to the urgent need for growth in Layer2 user adoption and ecosystem scale. And here’s the catch: top-tier Layer2 projects today already enjoy decent daily active users and solid revenue—good enough that they lack strong incentives to aggressively expand.
Now do you see where Ethereum’s Layer2 bottleneck truly lies?
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Haotian | CryptoInsight
