- The explosive growth of Degen Chain has sparked debate about the usefulness of L3.
- Polygon Chief argues that L3 could compromise the security and value of Ethereum.
Polygon (MATIC) CEO Marc Boiron expressed doubts about Ethereum (ETH) Layer 3 (L3) and highlighted its risks.
Boiron writes his thoughts on X (formerly Twitter) decided L3 siphons value from Ethereum to the underlying L2.
“Let me say the quiet part out loud. L3 exists solely to pull value from Ethereum and the L2 on which it is built. (No need for L3 for expansion). This is why Polygon Labs does not work in L3.”
Boiron’s criticism comes days after meme mania devoured Degen Chain, Base’s L3 that utilizes Arbitrum’s Orbit Chains via Degen Pepe (DEPE).
In less than a week, the native token DEGEN has exploded to record highs. user growthIt has over $130,000 worth of active addresses and over 4 million transactions.
Degen Chain: Pros and Cons of L3
In less than a week, Degen Chain’s impressive performance has sparked debate across Crypto Twitter (CT).
Other cryptocurrency users and personalities explored the pros and cons of L3, extending the debate into the Easter weekend.
For example, Jarrod Watts, Developer Relations Engineer at Polygon. decided L3 is cheaper but has worse decentralization than L2.
“L3 has worse decentralization than L2 and is very cheap. Current L2 decentralization is not great. It might be worth waiting for this to improve before building L3 on top. L3 still faces almost all the problems that L2 suffers without interoperability.”
Watts also acknowledged that L3 makes sense for cheaper onboarding.
However, he argued that interoperability protocols such as Polygon’s Aggregation Layer (AggLayer) can solve most of the problems that L3 is trying to solve.
Polygon principal Marc Boiron added that when L3 settles on L2, Ethereum security could be at risk if it is unable to capture any value.
“If all L3s settle on one L2, Ethereum essentially gains no value, putting Ethereum security at risk.”
Moreover, Boyron famous that such developments may cause the value of ETH to decline;
“If Ethereum earns no fees at all and has no possibility of earning any fees other than a small fee on this L2, the value of ETH will fall.”
Previous Coinshare highlighted Ethereum liquidity fragmentation can be partially addressed through interoperability protocols such as L3 and Polygon’s AggLayer.
However, recent debates show that L3 trade-offs may have implications for Ethereum security, and more research is needed.