The crypto community has been divided over Stripe’s decision to launch its own layer-1 blockchain, with many asking why the payment firm didn’t just build on top of an already existing blockchain network.
It came after Stripe CEO Patrick Collison said in an X post on Thursday that “existing blockchains are not optimized” to handle the growing use of stablecoins, and crypto more broadly, across the Stripe payment platform, while announcing the firm’s new layer-1 network, Tempo.
NFT platform Courtyard’s head of engineering, Joe Petrich, said, “No one wants another chain.”
“The problems you mention are already solved for people who are dead set on using blockchains, so there’s no need for yet another chain ‘fixing’ these issues,” Petrich said.
Stripe CEO is wrong about Solana’s TPS, execs say
Layer-1 blockchains prioritize security and decentralization, while layer-2 solutions are designed to maximize speed and scalability.
Collison argued that most blockchains can’t handle the scale of transactions that Stripe requires, which is more than 10,000 transactions per second (TPS) at its peak.
Source: Jason Zhao
He compared that with Bitcoin (BTC) processing roughly five TPS, Ethereum about 20 TPS, and newer networks like Base and Solana (SOL) reach around 1,000 TPS.
Helius Labs CEO and Solana maxi Mert Mumtaz said it was “hilariously wrong on several dimensions” and “that’s not even close to Solana’s limit.”
Mumtaz may have a point, as Solana Explorer data shows 3,186 TPS at the time of publication.
Not all were against the idea, however. Web3 wallet provider Fintopia CEO Steve Milton said, “Tempo building the rails for high-scale onchain payments is a game-changer.”
“It’s exactly the infrastructure apps like ours need to provide an even faster, cheaper, and seamless experience,” Milton said. Meanwhile, Privy chief operations officer Max Segal said, “Tempo looking good here.”
Others questioned why Stripe didn’t opt for Tempo to become a layer-2 network.
Ethereum L2 could still provide the benefits, says commentator
“Curious to know why you decided to build your own validator set instead of becoming an L2. Ensuring your validators are decentralized and diverse is better to outsourced,” Ethereum Foundation’s Devansh Mehta said.
Crypto commentator Leo Lanza asked a similar question: “What prevents Tempo from being built out as an Ethereum L2?”
Related: All filler, no pillar: Why blockchain cities fail
“As an Ethereum layer 2, Tempo could build custom TPS and fees paid in fiat while still taking advantage of Ethereum’s network effects, security, interoperability, and lower costs,” Lanza said.
Collison also argued that it’s more valuable for real-world financial applications for fees to be denominated in a fiat currency that makes sense to the user, but existing blockchains denominate their fees in blockchain-specific tokens.
“We hope that Tempo makes it easier for things like payment acceptance, global payouts, remittances, microtransactions, tokenized deposits, agentic payments, and more, to move onchain,” he added.
Magazine: ‘Accidental jailbreaks’ and ChatGPT’s links to murder, suicide: AI Eye