Close Menu
  • Latest News
    • Bitcoin
    • Ethereum
    • Altcoins
    • Meme Coins
  • Tech
    • Blockchain
    • Security and Privacy
  • Web 3
    • Gaming
  • Legal
    • Legal and Regulatory
    • Adoption
  • Analysis
  • Learn
    • Education
    • Wallets and Exchanges
  • Tools
    • Market Overview
    • Exchange Tool
What's Hot

Bitcoin Open Interest jumps 8% – Why BTC price faces liquidation risks

October 23, 2026

Stand With Crypto Advances GENIUS Act Implementation

October 23, 2026

Cosmos crypto defies market weakness – Can ATOM rally toward $2?

October 23, 2026
Facebook X (Twitter) Instagram
  • Contact
  • Privacy Policy
  • Terms & Conditions
  • Disclosure
Facebook X (Twitter) Instagram
Free.cc (Free Cryptocurrency)Free.cc (Free Cryptocurrency)
  • Latest News
    1. Bitcoin
    2. Ethereum
    3. Altcoins
    4. Meme Coins
    5. View All

    Bitcoin Open Interest jumps 8% – Why BTC price faces liquidation risks

    October 23, 2026

    Bitcoin, Hyperliquid (HYPE) and Zcash (ZEC) Price Ready to Bounce Back

    October 23, 2026

    Bitcoin, gold trim early losses as yen gives up gains. Oil stays near $100

    October 23, 2026

    The Sleeper Has Awakened: Pepenardo’s Sleeping Knights Return

    October 23, 2026

    ETH Slips Below $2,400 as ETF Outflows and Market Sell-Off Pressure Bulls

    October 22, 2026

    Ethereum: Can $61M in whale withdrawals help ETH bulls regain control?

    October 22, 2026

    Ethereum staking hits record highs – So why are yields falling?

    October 22, 2026

    Top Analysts Say A Rebound Could Be Close

    October 21, 2026

    Cosmos crypto defies market weakness – Can ATOM rally toward $2?

    October 23, 2026

    Chainlink’s $1.02M whale buy: An early Q4 signal or an isolated bet?

    October 23, 2026

    Zcash Foundation Details Zebra Sync Fixes Ahead Of NU7 Release

    October 23, 2026

    Perceptron announces ‘strategic migration’ of 800K node intelligence network to Walrus

    October 22, 2026

    Top 5 Memecoins to Watch in 2026: Hype, Utility, or Growth?

    October 14, 2026

    Did Jean Phil Go Viral First — or Was the Viral Persona Built to Launch a Memecoin?

    October 5, 2026

    Thinking Cat Gains Momentum After CASHCAT’s Breakout

    August 12, 2026

    What Tokens Could He Target?

    July 30, 2026

    Bitcoin Open Interest jumps 8% – Why BTC price faces liquidation risks

    October 23, 2026

    Stand With Crypto Advances GENIUS Act Implementation

    October 23, 2026

    Cosmos crypto defies market weakness – Can ATOM rally toward $2?

    October 23, 2026

    NeoRedPill launches Telegram wallet bot with Neo N3 wallets, cross-chain bridging

    October 23, 2026
  • Tech
    1. Blockchain
    2. Security and Privacy
    3. View All

    NeoRedPill launches Telegram wallet bot with Neo N3 wallets, cross-chain bridging

    October 23, 2026

    Quantum-Safe Blockchain Design Could Cut Fees and Network Bloat

    October 23, 2026

    User Empowerment in New Tweet

    October 23, 2026

    Prividium Delivers Control for Institutions as Money2020

    October 23, 2026

    Coinbase, Bitgo Say Unaffected by PHP Flaw; Binance’s CZ Urges Caution

    October 22, 2026

    Crypto Thieves Hijack Ngrave Alerts and Walk Away With $2.56M

    October 21, 2026

    Zcash Proposes New Privacy Layer to Guard Swaps From Quantum Risks

    October 20, 2026

    Qubic Loses $1.3 Million in Wallet Raid Before Network Halts

    October 18, 2026

    Bitcoin Open Interest jumps 8% – Why BTC price faces liquidation risks

    October 23, 2026

    Stand With Crypto Advances GENIUS Act Implementation

    October 23, 2026

    Cosmos crypto defies market weakness – Can ATOM rally toward $2?

    October 23, 2026

    NeoRedPill launches Telegram wallet bot with Neo N3 wallets, cross-chain bridging

    October 23, 2026
  • Web 3
    1. Gaming
    2. View All

    Top 12 NFT games every player should know about in August 2026

    September 22, 2026

    GameShame Studios founder details Raijin Protocol’s roadmap in NeoPod’s sixth AMA

    September 22, 2026

    Proof of Play to shut down after blockchain gaming thesis falls short

    September 22, 2026

    How BC.GAME is turning players into stakeholders

    September 22, 2026

    Bitcoin Open Interest jumps 8% – Why BTC price faces liquidation risks

    October 23, 2026

    Stand With Crypto Advances GENIUS Act Implementation

    October 23, 2026

    Cosmos crypto defies market weakness – Can ATOM rally toward $2?

    October 23, 2026

    NeoRedPill launches Telegram wallet bot with Neo N3 wallets, cross-chain bridging

    October 23, 2026
  • Legal
    1. Legal and Regulatory
    2. Adoption
    3. View All

    Stand With Crypto Advances GENIUS Act Implementation

    October 23, 2026

    Digital Chamber Celebrates GENIUS Act Finalization, A Win

    October 23, 2026

    UK FCA Opens DeFi and Crypto Consultations Ahead of 2027 Rules

    October 23, 2026

    UK financial watchdog opens consultations for DeFi guidance, crypto laws

    October 23, 2026

    Germany’s main savings bank network launches Bitcoin trading

    October 21, 2026

    Two firms control corporate Bitcoin buys, even as business adoption broadens

    October 16, 2026

    AI agents keep coming back for crypto as x402 wallet refill rate surges to 89%

    October 15, 2026

    Interactive Brokers moves into Ethereum’s $110 billion staking market as institutional demand accelerates

    October 14, 2026

    Bitcoin Open Interest jumps 8% – Why BTC price faces liquidation risks

    October 23, 2026

    Stand With Crypto Advances GENIUS Act Implementation

    October 23, 2026

    Cosmos crypto defies market weakness – Can ATOM rally toward $2?

    October 23, 2026

    NeoRedPill launches Telegram wallet bot with Neo N3 wallets, cross-chain bridging

    October 23, 2026
  • Analysis

    Evernorth XRP Holdings to Target Higher XRP Per Share, CEO Says

    October 23, 2026

    The Crucial $245 Level That Decides Bittensor’s Next Move

    October 23, 2026

    Can Fibre Push TIA Toward $9?

    October 22, 2026

    Does Avalanche Have What It Takes To Hit $55?

    October 22, 2026

    Solana bot turns just $12,000 into $1.4 billion in trading volume as fake liquidity floods Raydium

    October 22, 2026
  • Learn
    1. Education
    2. Wallets and Exchanges
    3. View All

    What Is Robinhood Chain? The Ethereum Layer-2 Network for Tokenized Stocks

    July 12, 2026

    What Is BChat? The Decentralized Messaging App Built for Privacy

    June 2, 2026

    What Is an AI Prompt Injection Attack? The Hidden Threat Hijacking Your Chatbots

    May 31, 2026

    What Is AI Jailbreaking? A Beginner’s Guide to the Cat-and-Mouse Game Behind Every Chatbot

    May 17, 2026

    SideSwap reopens Bitcoin swaps while Liquid reserves stay locked

    October 22, 2026

    Binance bStocks collateral pricing moves to 24/7

    October 21, 2026

    Binance Pool shuts on November 10, with record access ending two weeks later

    October 18, 2026

    82 criminal charges follow armed crypto abduction in Toronto

    October 16, 2026

    Bitcoin Open Interest jumps 8% – Why BTC price faces liquidation risks

    October 23, 2026

    Stand With Crypto Advances GENIUS Act Implementation

    October 23, 2026

    Cosmos crypto defies market weakness – Can ATOM rally toward $2?

    October 23, 2026

    NeoRedPill launches Telegram wallet bot with Neo N3 wallets, cross-chain bridging

    October 23, 2026
  • Tools
    • Market Overview
    • Exchange Tool
Free.cc (Free Cryptocurrency)Free.cc (Free Cryptocurrency)
Home»Blockchain»The L2 compromise is broken, it’s time for a better foundation
Blockchain

The L2 compromise is broken, it’s time for a better foundation

October 18, 2025No Comments6 Mins Read
Share
Facebook Twitter LinkedIn Pinterest Email

Disclosure: The views and opinions expressed here belong solely to the author and do not represent the views and opinions of crypto.news’ editorial.

The second quarter of 2025 has been a reality check for blockchain scaling, and as capital keeps pouring into rollups and sidechains, the cracks in the layer-2 model are widening. The original promise of L2s was simple: scaling up L1s, but the costs, delays, and fragmentation in liquidity and user experience keep stacking up.

Summary

  • L2s were meant to scale Ethereum, but they’ve introduced new problems, while relying on centralized sequencers that can become single points of failure.
  • At their core, L2s handle sequencing and state computation, using Optimistic or ZK Rollups to settle on L1. Each comes with trade-offs: long finality in Optimistic Rollups and heavy computational costs in ZK Rollups.
  • Future efficiency lies in separating computation from verification — using centralized supercomputers for computation and decentralized networks for parallel verification, enabling scalability without sacrificing security.
  • The “total order” model of blockchains is outdated; moving toward local, account-based ordering can unlock massive parallelism, ending the “L2 compromise” and paving the way for a scalable, future-ready web3 foundation.

New projects like stablecoin payments start questioning the L2 paradigm, asking if L2s are truly secure, and are their sequencers more like single points of failure and censorship? Often, they’ll end up taking a pessimistic view that perhaps fragmentation is simply inevitable in web3.

Are we building a future on a solid foundation or a house of cards? L2s must face and answer these questions. After all, if Ethereum’s (ETH) base consensus layer were inherently fast, cheap, and infinitely scalable, the entire L2 ecosystem as we know it now would be redundant. Countless rollups and sidechains were proposed as “L1s’ add-ons” to mitigate the fundamental constraints of the underlying L1s. It’s a form of technical debt, a complex, fragmented workaround that has been offloaded onto web3 users and developers.

See also  UAE Innovation City introduces onchain business IDs for AI-native economy

You might also like: Fair launch is the broken promise of crypto | Opinion

And to answer these questions, it’s necessary to deconstruct the entire concept of an L2 to its fundamental components, to reveal a path toward a more robust and efficient design.

An anatomy of L2s

Structure determines function. It’s a basic principle in biology that also holds in computer systems. To decide the proper structure and architecture of L2s, we must examine their functions carefully.

At its core, every L2 performs two critical functions: Sequencing, i.e., ordering transactions; as well as computing and proving the new state. A sequencer, whether a centralized entity or a decentralized network, collects, orders, and batches user transactions. This batch is then executed, resulting in an updated state (e.g., new token balances). This state must be settled on the L1 for security via Optimistic or ZK Rollups.

Optimistic Rollups assume all state transitions are valid, and rely on a challenge period (often 7 days) where anyone can submit fraud proofs. This creates a major UX trade-off, long finality times. ZK Rollups use zero-knowledge proofs to mathematically verify the correctness of every state transition before it hits L1, enabling near-instant finality. The trade-off is that they’re computationally intensive and complex to build. ZK provers themselves can be buggy, leading to catastrophic consequences, and formal verification of these, if feasible at all, is very expensive.

Sequencing is a governance and design choice for each L2. Some prefer a centralized solution for efficiency (or maybe for that censorship power; who knows), while others prefer a decentralized solution for more fairness and robustness. Ultimately, L2s decide how they wanna do their own sequencing.

See also  Volo and Dow Protocol Are Bringing E-Commerce Merchant Financing On-Chain for the First Time

State Claim Generation and Verification is where we can do much, much better in efficiency. Once a batch of transactions is sequenced, computing the next state is a purely computational task, and that can be done using just a single supercomputer, focused solely on raw speed, without the overhead of decentralization at all. That supercomputer can even be shared among L2s!

Once this new state is claimed, its verification becomes a separate, parallelized process. A massive network of verifiers can work in parallel to verify the claim. Such is also the very philosophy behind Ethereum’s stateless clients and high-performance implementations like MegaETH.

Parallel verification is infinitely scalable

Parallel verification is infinitely scalable. No matter how fast L2s (and that supercomputer) produce claims, the verification network can always catch up by adding more verifiers. The latency here is precisely the verification time, a fixed, minimal number. This is the theoretical optimum by using decentralization effectively: to verify, not to compute.

After sequencing and state verification, the L2’s job is nearly complete. The final step is to publish the verified state to a decentralized network, the L1, for ultimate settlement and security.

This final step exposes the elephant in the room: blockchains are terrible settlement layers for L2s! The main computational work is done off-chain, yet L2s must pay a massive premium to finalize on an L1. They face a dual overhead: the L1’s limited throughput, burdened by its total, linear ordering of all transactions, creates congestion and high costs for posting data. Furthermore, they must endure the L1’s inherent finality delay.

For ZK Rollups, this is minutes. For Optimistic Rollups, it’s compounded by a week-long challenge period, a necessary but costly security trade-off.

See also  LeverUp Partners with Pyth Network to Enhance Real-Time Data Feeds for Decentralized Perpetual Trading Applications

Farewell, the “total order” myth in web3

Since Bitcoin (BTC), people have been trying hard to squeeze all transactions of a blockchain into a single total order. We are talking about blockchains after all! Unfortunately, this “total order” paradigm is a costly myth and is clearly overkill for L2 settlement. How ironic, that one of the world’s largest decentralized networks and the world’s computer behaves just like a single-threaded desktop!

It’s time to move on. The future is local, account-based ordering, where only transactions interacting with the same account need to be ordered, unlocking massive parallelism and true scalability.

Global ordering of course implies local ordering, but it is also an incredibly naive and simplistic solution. After 15 years of “blockchain”, it is time that we open our eyes and handcraft a better future. The distributed systems scientific domain has already transitioned from the 1980s’ strong consistency concept (which is what blockchains implement) to 2015’s strong eventual consistency model that unleashes parallelism and concurrency. Time for the web3 industry to move on as well, to leave the past behind and follow forward-looking scientific progress.

The age of the L2 compromise is over. It’s time to build on a foundation designed for the future, from which the next wave of web3 adoption will come.

Read more: Web3 is open, transparent, and miserable to build on | Opinion

Xiaohong Chen

Xiaohong Chen is the Chief Technology Officer at Pi Squared Inc., working on fast, parallel, and decentralized systems for payments and settlement. His interests include program correctness, theorem proving, scalable ZK solutions, and applying these techniques to all programming languages. Xiaohong obtained his BSc in Mathematics at Peking University and PhD in Computer Science at the University of Illinois Urbana-Champaign.

Broken compromise Foundation Time
Share. Facebook Twitter Pinterest LinkedIn Tumblr Email

Related Posts

NeoRedPill launches Telegram wallet bot with Neo N3 wallets, cross-chain bridging

October 23, 2026

Quantum-Safe Blockchain Design Could Cut Fees and Network Bloat

October 23, 2026

User Empowerment in New Tweet

October 23, 2026

Prividium Delivers Control for Institutions as Money2020

October 23, 2026
Add A Comment
Leave A Reply Cancel Reply

Top Posts

Trader Who Nailed October 2025 Bitcoin Top Says There’s No Chance BTC Goes on a Bull Run Soon – Here’s Why

March 27, 2026

Bitcoin faces a brutal irony as the Treasury refuses to save BTC from its own political success

February 5, 2026

Stay ahead with the latest crypto news, market updates, blockchain insights, and trends. Your trusted source for everything happening in the digital asset world.


We're social. Connect with us:

Facebook X (Twitter) Instagram Pinterest YouTube
Top Insights

Bitcoin Open Interest jumps 8% – Why BTC price faces liquidation risks

October 23, 2026

Stand With Crypto Advances GENIUS Act Implementation

October 23, 2026

Cosmos crypto defies market weakness – Can ATOM rally toward $2?

October 23, 2026
Get Informed

Subscribe to Updates

Get the latest creative news From Free.cc directly in your Inbox!

  • Contact
  • Privacy Policy
  • Terms & Conditions
  • Disclosure
© 2026 free.cc - All rights reserved.

Type above and press Enter to search. Press Esc to cancel.