Vitalik Buterin Says Layer 3s Won’t Magically Increase Throughput

Ethereum co-founder Vitalik Buterin has re-upped his post from 1.5 years ago on “Layer 3s”, saying that L3s won’t magically increase throughput. Still, they can reduce certain fixed costs associated with batch publishing and deposits or withdrawals.

His statement comes amid concerns that Layer 3 networks are taking away from Ethereum’s value and security.

L3 Doesn’t Magically Increase Throughput

According to Buterin’s X post, there are alternative, potentially “lighter” approaches to achieve similar cost savings as those offered by Layer 3 solutions.

However, there are other, potentially “lighter”, ways to get the same cost savings that you get from L3s. pic.twitter.com/WTijiTAOE1

— vitalik.eth (@VitalikButerin) April 2, 2024

In his prior post, Buterin outlined models for Layer 3 solutions. In one of them, Layer 2 is responsible for scaling, while Layer 3 focuses on customizing functionality. While this doesn’t directly enhance scalability, it allows applications to scale through L2s while dissecting layers to meet specific operational requirements for diverse use cases.

The second model involves Layer 2 scaling for general purposes, with customized scaling handled by Layer 3. This can be achieved through rollups, which optimize data formats for specific applications.

The third model assigns Layer 2 for trustless scaling and Layer 3 for weekly trusted scaling. Here, Layer 2 focuses on rollups, while Layer 3 incorporates Validiums. They utilize SNARKs for computation verification but rely on a trusted third party for data availability. Despite having lower security levels, Validiums are cost-effective, as pointed out by Buterin.

He then said that he favored the three-layered blockchain model over the two-layered one, highlighting that the former enables an entire ecosystem to function within one rollup. This setup allows for cross-domain activities across the ecosystem cost-effectively, eliminating the need to bear the expensive costs associated with Layer 1.

Layer 3 Sparks Controversy

While some advocate for integrating Layer 3 (L3) networks to enhance Ethereum’s efficiency and functionality, there are concerns among others regarding their potential implications for decentralization and network security.

In a post on March 31, the Polygon Labs CEO argued that they opted not to develop Layer 3 chains because they were deemed unnecessary and detrimental to Ethereum’s value. He emphasized his belief that Layer 3 networks posed a security threat to Ethereum, illustrating a scenario where all Layer 3s settle on a single Layer 2.

Boiron argued that if Ethereum were to generate minimal fees and lacked prospects for future earnings, its value would diminish. Consequently, validators would lose confidence in holding ETH, leading to decreased network security.