Native L2s for Ethereum

Devcon Bangkok is seeing a lot of debates about Ethereum's future. The latest keynote on the topic was Martin Koeppelmann of Gnosis, who spoke Friday on the event's main stage.

Wearing a Tornado Cash t-shirt, Koeppelmann challenged the status quo of layer-2 rollups, proposing that Ethereum should instead develop and deploy its own zk-proven rollups.

Köppelmann emphasized the limitations of existing rollups such as Base, which he argued are bringing users not to Ethereum but to corporate-controlled platforms.

"I have the highest respect for Jesse [Pollack] and Coinbase," he remarked, "but bringing people to those L2 ecosystems is quite different from being on Ethereum." He warned of the potential for shareholder-driven decisions — like the introduction of additional fees in the future — that could undermine the Ethereum ethos.

A central critique was the marketing claim that rollups "inherit Ethereum's security." While possible in principle, Koeppelmann noted that none of them does in practice.

He illustrated vulnerabilities such as central sequencers' ability to censor withdrawals or manipulate state in DeFi platforms like Aave, as articulated in a Devcon talk by James Prestwhich. Moreover, he noted that most assets on rollups are native to those chains, not subject to Ethereum's security guarantees.

What would native L2's look like?

Koeppelmann envisioned 128 identical interoperable native L2s, rigorously built with Ethereum's high standards — no multisigs, multiple client implementations, and community scrutiny.

The number is a bit arbitrary, but "the idea is to make it clear that building on Ethereum is a long-term viable option," he explained, with a goal to achieve a "100x increase in effective block space" over the next two years.

These rollups would maintain strong composability with Ethereum while addressing scalability, cost, and user adoption for billions of users.

Key to his proposal is integrating these rollups into Ethereum's economic framework. For instance, Ethereum validator rewards could incentivize proof correctness, enhancing security and aligning rollups with Ethereum's values.

Developers would have the option to build directly "on Ethereum" rather than on external ecosystems, with the choice of a specific rollup dependent on the dapp's needs.

"If there are other applications you want to regularly interact with [on a specific rollup], then it would be wise to choose that rollup." However, for developers requiring only Ethereum mainnet connectivity, "you should just choose the rollup that is used the least, because that will be the cheapest."

He also called for distinct namespaces to prevent address collisions across these L2s, improving cross-chain clarity.

Köppelmann concluded by urging the Ethereum community to act decisively. Without native L2s, he warned, Ethereum's role could diminish: "The connection between rollups and Ethereum becomes a meme."

Conversely, embracing native rollups could position Ethereum as "the most important economic zone in the world."

Ethereum stands at this crossroads, Koeppelmann said, as he challenged the broad community to rethink scalability and governance while staying true to its decentralized ideals.

— Macauley Peterson (X: @yeluacaM | Farcaster: @Macauley)

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Curve 3Pool over time:

Source: @steakhouse

The Curve Finance 3Pool chart reflects a pivotal piece of DeFi history, illustrating the rise and decline of stablecoin liquidity in one of the ecosystem's most influential pools. Originally, the 3Pool was instrumental in supporting DAI and became a key indicator of stablecoin trust. Liquidity levels peaked in early 2022 before gradually declining, highlighting shifting preferences and evolving market conditions within DeFi.

As Curve continues to innovate with products like crvUSD, Llama Lend, and next-generation pools, its relevance remains evident. However, the tokenomics of $CRV, Curve's governance token, have sparked debate. Some argue that the protocol's focus on veToken mechanics and the so-called "Curve wars" has detracted from more product-driven growth. Yet, with $CRV emissions now reduced and its price potentially stabilizing, some see this as an opportunity for the token to rebound, even as community sentiment remains divided on its long-term value.

AI-powered gaming

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In crypto, platforms such as Truth Terminal, Virtuals.io, and Parallel Colony are integrating AI agents into blockchain-based gaming, enabling unique gameplay designs. Oasis diverges from traditional game engines like Unity by generating in-game interactions frame-by-frame, creating entirely novel experiences.

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Explore more insights in Blockworks Research's flashnote by Danny K.

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