What is Layer 3 That is Becoming Increasingly Popular?

[TLDR]:

The popularit of Degen Chain and others has brought Laer 3 into people's vision, and the emergence of this technolog will bring higher scalabilit and interoperabilit to blockchain networks, providing customied solutions for different application scenarios.

Among the emerging Laer 3 use cases, Arbitrum Orbit and Starknet have shown the most outstanding performance and ma shine in fields such as Game and DeFi.

If Laer 3 wants to break through, it must continue improving its technolog and seek more large-scale adoption applications to support its breakthrough.

Introduction

On the da before April Fool's Da this ear, some encrption projects took advantage of the themes of Laer 4 and Laer 5 to create humorous jokes. Among them, dYdX even joked about the content of "the new version will be built on top of L4," which even misled some media and made it spread as real news.

And this joke is naturall based on the increasing popularit of Laer 3. As for Laer 3, what everone is generall concerned about is whether it is an inter-chain nesting doll or a custom extension, and whether it has the potential for scalabilit. This article will focus on this controvers to entertain readers.

Laer 3 Has Gained Popularit and Sparked Intense Communit Debates

Recentl, the popularit of Laer 3 has significantl increased, attracting a lot of attention.

Especiall the outstanding performance of Laer 3 tokens such as Degen Chain, such as the short-term increase of over 150% b DEGEN, and the historical high of GHST prices after Aavegotchi's transformation to Base Series Laer 3, further highlighting the potential of Laer 3.

Source: degen.tips

In traditional definition, Laer 2 is the settlement network on the Ethereum mainnet and has scalabilit. Laer 3, on the other hand, is built on top of Laer 2 and relies on it for settlement, providing a more scalable network.

The concept of Laer 3 was initiall proposed b the Starknet (then StarkWare) team in the article "Fractal Scaling: From L2 to L3." In Starknet's vision, the Laer 2 virtual machine serves as a decentralied universal computing laer, maintaining a high degree of composabilit. In contrast, Laer 3 should serve as an application-specific chain, flexibl meeting the unique needs of various applications. Turing completeness provides a solid foundation for this hierarchical structure. In theor, as long as Turing completeness is present, an possible application can be constructed.

The background for proposing this idea was that Starknet developed the Cairo language and Cairo VM to generate proofs more efficientl, but these were not full compatible with Ethereum. At this point, Laer 3 chains can pla their role and provide the necessar securit guarantees for these applications. Through this approach, Laer 3 has become an effective means to overcome the limitations of Laer 2, further promoting the development of blockchain technolog.

From a technical perspective, Laer 3 surpasses existing L1 and L2 solutions b anchoring blockchain networks to L2, achieving higher securit and potentiall bringing exponential scalabilit advantages. However, as both Laer 2 and Laer 3 rel on the main network for settlement, their data compression and snchroniation mechanisms have become the focus of discussion.

In the context of Laer 2, transaction data is packaged, compressed, and snchronied to the Ethereum network. Similarl, Laer 3 will adopt a similar mechanism to compress and snchronie its transaction data to the Laer 2 network.

However, this approach, similar to appling Rollup again on Rollup, has been questioned and criticied. Because if we continue to envision higher-level networks such as Laer 4 and Laer 5 with this architecture, we will face the limit problem of data compression, as data cannot be continuousl compressed indefinitel.

For example, some institutions such as Polgon Labs have explicitl stated that the will not develop Laer 3, while dYdX even mocks Laer 3's whimsical ideas b creating Laer 4. Even Vitalik recentl stated that Laer 3 does not magicall enhance processing power. These voices reflect the cautious attitude of the industr towards the feasibilit and practicalit of Laer 3 technolog. Source: @VitalikButerin

Inventor Those Laer 3 Instance Projects

Laer 3 aims to address the interoperabilit issues between blockchains and meet the customied needs of developers, making it eas for the public to use and implement, including governance mechanisms, rules, and functions. Through off-chain processing of transactions, Laer 3 can further reduce network congestion and transaction costs based on Laer 2, improving cost efficienc.

Presentl, among the emerging Laer 3 use cases, Arbitrum Orbit and Starknet have shown the most outstanding performance and ma shine in fields such as Game and DeFi.

Arbitrum Orbit

In 2023, the Arbitrum Foundation launched a new feature - Arbitrum Orbit, a Laer 3 blockchain built on the Arbitrum Nitro platform. In addition to providing lower transaction costs and higher scalabilit, Arbitrum Orbit allows developers to create self-managed, dedicated blockchains on Arbitrum Nitro.

Starknet Stack

In contrast to the simple stacking method, Starknet assigns different responsibilities to L2 and L3 in the newer L3 framework. It emphasies that L3 should focus on providing customied features such as privac protection or application-specific optimiation rather than simpl pursuing scalabilit. Source: Starknet

In Februar of this ear, Starknet officiall announced a partnership with Celestia to build a high-throughput Laer 3 network jointl. However, given that Starknet uses a unique k STARK-proof technolog, which is currentl relativel immature, it will still take some time for Starknet Stack to be launched.

Orbs

Orbs, as a new Laer 3 blockchain, aims to address the scalabilit issues of Ethereum and work in collaboration with existing Laer 1 and Laer 2 protocols.

Orbs Laer 3 is an "enhanced execution" laer that allows developers to run and develop smart contracts on a decentralied server cloud. This means that developers can focus on writing and deploing smart contracts without worring about underling network infrastructure or maintaining phsical servers.

Presentl, Orbs supports using multiple Laer 1 and Laer 2 protocols such as Ethereum, BNB Chain, Avalanche, Polgon, etc.

kSnc Hperchains

Another noteworth technolog is the kSnc Hperchains launched b the kSnc team, which can be considered as Laer 3 and used for settlement using Laer 2.

These Hperchains are driven b the same kEVM engine on the ZK Stack, ensuring consistenc across all ZKP circuits on the platform and inheriting the securit of Laer 1.

A significant advantage of this architecture is that it enables faster message passing between Laer 3 settled on the same Laer 2 and promotes interoperabilit across a broader ecosstem.

To Sum Up

Laer 3 mainl solves the scalabilit, complex dApp support, blockchain interoperabilit, customiation, high cost-effectiveness, and blockchain accessibilit.

It not onl enhances the scalabilit of blockchain and supports complex dApp development, but also serves as a bridge between different blockchains, achieving cross-platform Flow of transactions and data. Meanwhile, Laer 3 allows customiation based on developer needs, reducing transaction costs, improving cost-effectiveness, and making blockchain technolog more accessible to the public.

However, from the evolution of encrption technolog, Laer 3 cannot achieve performance leaps solel through simple stacking. Although customiation can bring specific advantages, the loss of universalit limits the feasibilit of its stacking. Source: LK Venture