‘Only a few’ Ethereum L2s will survive the next 5 years: Manta co-founder

Kenny Li, co-founder and COO of Manta Pacific, predicts that in five years, only a select few of the 44 active Ethereum layer-2 (L2) blockchains will remain relevant in the ever-evolving crypto landscape. Li specifically highlights “modular” blockchains like Manta, Celestia, and Cosmos as the ones with a promising future.

Currently, L2Beat reports a total of 44 active Ethereum L2 networks, boasting an impressive combined TVL of $36.92 billion. At the top of the list is Arbitrum, with a TVL of $14.5 billion.

Despite Li’s confidence in the success of “modular” blockchains, critics argue that this term is simply a “marketing stunt” and has no impact on a network’s development and scalability. However, Li remains steadfast in his belief that the future of crypto lies in the hands of innovative and adaptable blockchains like Manta, Celestia, and Cosmos.

‘Monolithic’ BTC and ETH competitors

During an interview with Cointelegraph, Li argues that the influx of new L2s on the Ethereum network is following the same path as previous “forks” of the Bitcoin and Ethereum networks, none of which were able to survive.

Li explains that all of the Bitcoin forks, including Bitcoin Cash and BSV, simply took the existing technology and made minor changes in an attempt to create something “better than Bitcoin.”

In 2016, the same pattern emerged with Ethereum as new networks like EOS and NEO claimed to be “Ethereum killers,” offering alternative Ethereum Virtual Machine and VM environments with slight modifications to the existing ecosystem.

According to Li, the main issue with all of these Bitcoin and Ethereum “forks” is that they were built in a monolithic manner, lacking the ability to easily integrate and adopt new technologies as they emerged.

“They all built monolithically, and what happened to them, right? Fast forward to 2024, and Ethereum remains the dominant player,” Li concludes.

Modular blockchains, on the other hand, export their primary tasks such as execution, settlement, consensus, and data availability to external blockchains, providing greater design flexibility.

Monolithic blockchains, in contrast, prioritize a single-system architecture, handling all tasks within a single layer of the network.

However, some argue that the debate between “modular vs. monolithic” is unnecessary.

Perhaps it’s simply a ‘publicity stunt’

Austin Federa, head of strategy at the Solana Foundation, believes that the ongoing debate between the terms “modular” and “monolithic” is simply a ploy by Celestia to gain attention.

While many view Ethereum’s “modular” design, which relies on L2s for specific tasks, as being in direct contrast to the “monolithic” nature of other high-throughput networks like Solana and Avalanche, Federa disagrees with this characterization.

“We must remember that the modular versus monolithic argument is nothing more than a marketing tactic,” stated Federa. “Celestia created this divide between the two, but it’s not a natural or organic distinction.”

Li suggests that Manta, which launched on January 18, could be considered the “largest and first” modular layer-2 network on Ethereum, as it utilizes Optimism’s OP stack and Celestia for data availability (although Ethereum co-founder Vitalik Buterin would argue that this makes it a “validium” rather than a true L2).

As of now, Manta is the fourth-largest L2 network in terms of TVL, having recently been surpassed by the new L2 Blast, which went live on March 1st.

“We don’t follow a monolithic approach. We haven’t built anything in terms of core architecture on our own,” explained Li.

“We take a highly modular approach, allowing us to easily incorporate various technologies as they become available so we can adapt to changing demands,” Li added.

However, Federa argues that there is no need to differentiate between the two approaches.

Federa clarified that a monolithic network is simply an “integrated” blockchain where tasks are handled within a single layer, while “modular” or “fragmented” networks perform the same functions across multiple layers and do not significantly contribute to the success or outcomes of a given network.

“I believe that framing these two approaches as being at odds with each other is not a particularly useful or accurate way to think about these systems. They are simply different software architecture choices that are not fundamentally distinct in the end,” Federa concluded.

Categorized in:

Tagged in: