Ethereum's second-layer solutions processed more transactions than the Bitcoin network
Ethereum's second-layer solutions processed more transactions than the Bitcoin network By Hannah Perez

Ethereum’ slayer-two

protocols are becoming popular with transaction fees rising again. In total, they have more than USD $1 billion of funds locked up.

Ethereum

s layer-two ecosystem is now processing more transactions per day than the Bitcoin

network, according to recent findings

.

Cryptocurrency analyst and Week In Ethereum News founder Evan Van Ness shared data compiled from CoinMetrics indicating that on Monday this week Ethereum’ s Layer-Two processed more transactions than the Bitcoin network. According to the enthusiast, the second layer protocols processed around 250,000 transactions per day, while Bitcoin

around 210,000.

The second layer or ‘layer 2’ is a term used to denote solutions designed to help scale Blockchain transactions off the mainnet

(main network or layer 1), while leveraging mainchain security. Second-layer scaling solutions are designed to counteract network congestion, helping users save on transaction fees.

For example, second-layer protocols such as Starkware, Optimism and Arbitrum, provide scaling solutions for decentralized applications and exchanges to use the <a href=”https://www.diariobitcoin.com/glossary/ethereum/” target=”_blank” rel=”noop” rel=”noop” network.

ener”>Ethereum. Currently, with gas prices -transaction fees- of Ethereum rising again, the second-layer ecosystem for this Blockchain is rapidly gaining popularity.

Ethereum’s Layer 2 is growing in use

According to Van Ness’ report, the Starkware protocol processed the highest number of daily transactions during that period, with around 143,000 transactions for a number of decentralized finance (DeFi) platforms, such as the dYdX exchange and the non-fungible token (NFT) platform, Immutable X.

The Arbitrum solution, meanwhile, recorded around 56,000 transactions on Monday. Last week, Arbitrum’s layer 2 platform, Arbitrum One, was launched. Ethereum Arbitrum One, was launched on the main network. This protocol is already attracting prominent DeFi ecosystem platforms, including Aave, Chainlink y Uniswapwhich have begun to take advantage of the scaling solution.

The researcher also noted that Optimistic Ethereum recorded around 28,000 transactions during the day. The popular DEX Uniswap deployed its version 3 on Optimism in July. Synthetix’ s DeFi Kwenta trading platform DeFi Kwenta also recently launched a second-layer version on this protocol.

However, despite this data, some community enthusiasts were quick to point out that Van Ness’s report drew a comparison between transactions recorded on layer two of Ethereum with those processed by the main chain of Bitcoinwithout considering the second layer solutions of this network, such as the Lightning Network.

The Lightning Network protocol has seen a significant surge in recent weeks, expanding its capacity to more than 2,300 BTC, according to Bitcoin Visuals. The increased capacity means more competition to facilitate transactions, though it doesn’t necessarily translate into high transaction volume.

In this regard, Van Ness responded that his impression was that “given the small amount locked in, Lightning has very little traction, but I’m glad if someone shows me howmuch traction it has.Thedata tothe contrary.

More than $1 billion blocked

Transaction volume isn’t the only metric that highlights the growing boom that the layer 2 ecosystem is having from Ethereum. According to data from layer two solutions tracker. L2Beatthese protocols currently have more than $1 billion in blocked funds (TVL).

Ethereum's second-layer solutions processed more transactions than the Bitcoin networkEthereum's second-layer solutions processed more transactions than the Bitcoin network

L2Beat tracks layer two rollups, a type of scale-out solution that sits atop the Blockchain EthereumThe L2Beat solution, processing a series of transactions in a batch before sending them to the main chain as a single transaction.

According to L2Beat, cryptocurrency exchange dYdX tops the list with nearly USD $280 million in funds arranged as collateral. This data matches that shared by the researcher, as dYdX is one of the top platforms leveraging a second-layer solution from Ethereum.

Other protocols such as Nahmii 1.0, Loopring, ZKSwap V2, Optimism and Arbitrum stand out among the top of the list with the highest LTV. In total, the top ten protocols by blocked value register a total of USD$547.56 million.

It is worth noting that, at the time of publishing, the average transaction cost of the . Ethereum is USD $36.5, according to data from Bitifoncharts. Second-layer solutions such as Loopring and Hermez offer more profitable commissions of USD $0.40, according to . L2Fees. According to that data, transactions on Arbitrum One cost USD $2.75, while on Optimism USD $5.83.

Recommended reading

Sources: Cointelegraph, Decrypt,

Version by Hannah Estefania Perez / DiarioBitcoin

Image from Unsplash