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Will ‘The Merge’ impact other Ether Layer-2 chains?

According to the crypto industry, Ethereum will still require layer-2 chains after The Merge, but this isn't a foregone concl

This year, Ethereum will finally switch to proof-of-stake, with the goal of:

“Ultimately address some of the gas fee issues.”

Layer-2 solutions are one of the most common ways to cut gas costs. Polygon, for example, processes more than three million transactions every day and has hundreds of millions of addresses.

Will Ether layer-2 networks continue to exist after The Merge? Here are the views of several web3 creators on the biggest event in crypto history.

Solutions for the second layer

Layer-2 networks are built on top of the Ethereum network (also known as Layer-1). Layer-2 protocols come in a variety of flavors. In essence, layer-2s execute transactions independently to finish more transactions per second with reduced gas rates, and the transactions are later registered in the Ethereum blockchain.

The necessity for layer-2s will be reduced if Ethereum’s transition to proof-of-stake meets its goal of addressing gas fees and transaction volume. Furthermore, switching to proof-of-stake can improve the network’s security mechanism. Vitalik Buterin, the founder of Ethereum, stated that proof-of-stake provides:

“Greater efficiency and better able to handle and recover from attacks.”

Solutions for post-merger scaling

Layer-2s may benefit from Ethereum’s greater efficiency. According to Alan Chiu, CEO and Founder of Boba Network, a Layer 2 Optimistic Rollup scaling solution,

“As Ethereum L1 becomes more efficient, L2s will simply become even more efficient while preserving their existing added benefits.”

As Harold Hyatt, Trusttoken’s Product Manager of DAO & DeFi, explains:

“Ethereum-based scaling solutions (L2) scale with ethereum. Therefore, if ethereum scales in the future (sharding), L2s will also scale with it.” If Optimism is ten times faster than L1, Ethereum will be ten times quicker after sharding, and Optimism will be 100 times faster.”

Ethereum’s mainstream adoption

“Even after the merge, we will need as many scaling solutions as feasible to get to mainstream usage,” says Ahmed Al-Balaghi, co-founder of Biconomy, a multichain relayer protocol. Even with the rising popularity of crypto since 2020, mainstream adoption is still a long way off, with only 4% of the population owning crypto in 2022.

The demand for networks like Ethereum will massively boost as adoption grows. Poapster, a contributor to Harvest Finance, a popular DeFi yield farming methodology, holds the following beliefs:

“What we’ll see is that Ethereum will become the global settlement layer, with the majority of smaller transactions taking place on all the other L2’s and EVM compatible chains.”

As a result, the industry believes Ethereum layer-2 solutions will play a significant role in the network’s future. Layer-2s have a bright future, according to Brian Fu, Co-Founder of zkLend, a money-market protocol based on zk technology.

“L2 ecosystems have reached critical mass in volume and activity, resulting in an explosive network impact. Users have begun migrating to rollup networks.”

Furthermore, Fu forecasts the emergence of a “Super L2” solution… The traits and capabilities of fractal scaling are supported. “Hyper-scalability and bridging will be enabled via L3 networks.”

dApps are being used more frequently.

With more scaling options, Puff, a contributor to the Iron Bank, a powerful Ethereum platform, believes that the merger:

“Would get us a little closer to shard chains.” With sharding in place, we expect Ethereum’s scalability and capacity to improve, lowering costs and increasing accessibility of decentralized apps.”

Increased network engagement will be directly proportional to the use of dApps. Thanks to a scalable and fast-transacting decentralized network, individuals can govern their assets, identities, and finances without relying on centralized authority.

It will not be proof-of-stake but “layer two solutions [that] will become the true stimulant to fully realize the full potential of Ethereum and the goal of DeFi,” according to Thibault Perréard, Head of Strategy at Bifrost.

Although there are many objections against this approach, proof-of-stake is more environmentally friendly. Chris, the Co-Founder of Eden Network, thinks that Ethereum’s proof-of-work may not be over yet.

“Computing the proofs required for zero-knowledge rollups (and other zk applications) necessitates massive computing power — what would be the use of all the mining gear when the merge takes place?” Does it just sit there collecting dust, or will a market emerge where miners can repurpose their GPUs to protect these new networks?”

Layer-2 networks will have no function after The Merge, according to proof-of-work maximalists, and Ethereum will fail. Others, such as Tyler Perkins, CMO of zkSync, do not believe The Merge will impact layer-2s.

Perkins said that The Merge will have “little impact” and that “sharding, which is planned for after the merge, will have the largest influence on L2s since it will increase the amount of data storage accessible to rollups; substantially improving their throughput.”