As major exchanges increasingly collaborate with blockchain development teams, the number of Ethereum Layer 2 (L2) solutions continues to grow. While some view this as a sign of ecosystem diversification, critics argue it may lead to excessive complexity.
DeFi analyst Ignas recently shared his perspective on this trend, stating that the proliferation of new L2s has made him increasingly optimistic about alternative Layer 1 (alt L1) blockchains. His reasoning?
- Fragmentation Concerns: More L2s dilute attention and capital, leaving investors confused about where to allocate resources. This could fracture Ethereum's ecosystem.
- Inherent Advantages: Chains like Solana and Avalanche already offer Ethereum L2 benefits (low costs, high throughput) while maintaining stronger community consensus and development resources.
- Innovation Gap: Post-last bull cycle, alt L1s have become more specialized and innovative. Many L2s, meanwhile, host copycat protocols with limited originality.
- Tokenomics Issues: Poor token designs (e.g., ARB's controversial "staking proposal") threaten ecosystem sustainability.
👉 Discover how top alt L1s are reshaping blockchain scalability
Comparative Advantages of Leading Alt L1s
Ignas highlighted key strengths across major alternative blockchains:
| Blockchain | Key Differentiation |
|---|---|
| Avalanche | "Subnet" scaling for asset tokenization; stablecoin-focused FX chains |
| Polygon | Sovereign L2 hub for app-specific solutions (e.g., OKX integration) |
| Near | Hybrid modular/monolithic chain with unified UI (BOS) for L2 abstraction |
| Solana | High-throughput monolithic design (no modular UX complexity) |
| Fantom | 2,000 TPS via Sonic upgrade (no sharding/L2s needed) |
| BNB Chain | Greenfield upgrade for DataFi and privacy-preserving AI models |
| Cosmos | Thriving hub despite ATOM's unclear value proposition (Osmosis/Injective growth) |
FAQs: Ethereum L2s vs. Alt L1s
Why are investors shifting focus to alt L1s?
With Ethereum L2s competing for attention, alt L1s offer clearer roadmaps, specialized use cases, and stronger token utility—making them more attractive for focused capital allocation.
How do transaction costs compare?
While L2s reduce Ethereum fees, chains like Solana and Avalanche maintain similarly low costs without relying on parent-chain security.
What about developer activity?
👉 Explore ecosystems with the highest developer retention rates—many alt L1s now outperform Ethereum L2s in net new devs/month.
Are L2s becoming redundant?
Not entirely. L2s still serve Ethereum-centric projects, but alt L1s increasingly dominate for niche applications (e.g., Avalanche for institutional tokenization).
Final Thoughts
The blockchain scalability debate isn't zero-sum. However, as Ignas notes, alt L1s' unified ecosystems and innovation focus position them strongly against fragmented L2 landscapes. For investors, diversification across both may be optimal—but due diligence on tokenomics remains critical.