Polygon Takes Lead as Ethereum Layer 2 Networks Experience Surge in Daily Users – Report

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  • Three Ethereum layer 2 networks, Polygon, Optimism and Arbitrum One, are currently experiencing a surge in daily users which leads to a growth in fees for the respective ecosystems, data analytics platform Terminal revealed.
  • Polygon, a sidechain scaling solution that allows speedy transactions and low fees, has had almost doubled active users for the past three months. It reached more than 600,000 daily users earlier this year, a 92% increase from October 2022’s 313,400 daily users.
  • Optimism, a scaling solution built for Ethereum developers, also experienced a daily user spike of 190% over the past three months. It also reached at least a 140% gain in daily network fees since 2023 started.

Three Ethereum layer 2 networks – Polygon, Optimism, and Arbitrum One – are currently experiencing a surge in daily users which leads to a growth in fees for the respective ecosystems, data analytics platform Terminal revealed.

Polygon, a sidechain scaling solution that allows speedy transactions and low fees, has had almost doubled active users for the past three months. It reached more than 600,000 daily users earlier this year, a 92% increase from October 2022’s 313,400 daily users. The increase has also led to nearly $55,000 in daily network fees for Polygon.

Meanwhile, Optimism, a scaling solution built for Ethereum developers, also experienced a daily user spike of 190% over the past three months. It also reached at least a 140% gain in daily network fees since 2023 started.

And lastly, Arbitrum One, developed by the New York-based company Offchain Labs, has had a 40% increase in active users for the past three months. From almost 30,000 last October 2022, it currently has approximately 42,000 daily users. 

What is a Layer 2 Network? 

A Layer-2 scaling solution is a technology that runs on top of a blockchain protocol that claims to improve the speed and efficiency of the Ethereum blockchain. Basically, these networks are made to support Ethereum, which has reached a some limits due to many transactions. These limits of the Ethereum blockchain result in network congestion, longer transactions, and higher gas fees. 

Thus, these layer 2 networks will help solve the limits of the network by processing transactions on third-party networks instead of the Ethereum mainnet. Through these layer 2 networks, the Ethereum mainnet’s congestion will be eased and will help maintain the same security and decentralized standards of the Ethereum blockchain. 

Some of the advantages of using a layer 2 network include an increase in transaction time, smaller gas fees, and extra security imposed by the network. However, some of the disadvantages of using a layer 2 network include the removal of liquidity from the Ethereum blockchain, and potential security and privacy vulnerabilities.

This article is published on BitPinas: Polygon Takes Lead as Ethereum Layer 2 Networks Experience Surge in Daily Users – Report

Disclaimer: BitPinas articles and its external content are not financial advice. The team serves to deliver independent, unbiased news to provide information for Philippine-crypto and beyond.

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