Tag: Ethereum 2.0

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Ethereum

Best 10+ Ethereum Layer 2 Projects and Sidechains

Ethereum is currently powering the future of global decentralised finance (known as “DeFi”) so it’s blockchain must be well equipped to scale and handle an influx of apps and users into the millions. Currently there are limitations with Ether blockchain with speed and high transaction fees, which has led to the emergence of Ethereum layer 2 projects that help resolve the network performance and enable continued expansion of the DeFi ecosystem.

What is Ethereum Layer 2?

A layer 2 project is a company and network of its own that operates on top of the Ethereum blockchain base layer (known as “layer 1”). Layer 2 projects (also known as “sidechains”) connect Decentralised applications (Dapps) to interact with aspects of the layer 1 blockchain to significantly speed up transactions, whilst making use of the base layer’s privacy and decentralised infrastructure.

Why use Layer 2 Projects?

The main Ethereum 1.0 blockchain currently has a low speed of around 7-15 transactions per second (TPS). Layer 2 solutions can achieve much faster speeds of up to 9,000 tps by handling most of the hard processing “off-chain” on their sidechains to increase efficiency.

There are an increasing amount of layer 2 projects and sidechains in circulation, each working to improve user experience for swapping coins and tokens, minting NFTs, reducing transaction GAS fees and increasing the speed of transactions.

We have compiled a list below of what we think are the best 10+ Ethereum layer-2 projects and sidechains worth knowing about.

1. Polygon

https://www.mtpelerin.com/buy-polygon-matic
Polygon – a multichain ecosystem.

Polygon is a protocol and framework that allows projects to connect with Ethereum-compatible networks to enable ‘scalable-solutions’ for a multi-chain ecosystem.

Advertised as being for developers, by developers, Polygon has identified the challenges facing the Ethereum blockchain and presented its own solutions by offering instant and ‘zero-gas’ transactions with a Proof-of-stake (PoS) chain.

Polygon utilises the MATIC token, which helps to secure the network and to pay any transaction fees. Originally the project was called MATIC and was seen as a direct competitor to Ethereum, but in 2021 it rebranded to Polygon and now enhances the Ethereum ecosystem rather than directly competing with it.

There are currently over 3,000 decentralised applications running on the Polygon network which include wallets, oracles, DeFi, DAO, B2B NFT and Gaming projects.

2. Optimism

https://www.optimism.io/
Optimism – utilising rollup chains.

Optimism is a community focused layer 2 framework that offers projects with lighting speed for a lower cost to transmit data to and from the layer 1 blockchain. Optimism is an optimistic rollup chain, which means a large batch of transactions are ‘rolled’ together and then condensed and processed on layer 1.

The Optimism ecosystem promotes hundreds of apps and integrations including DeFi, NFTs, Bridges and Portfolio trackers. There isn’t a native token for the Optimism project yet. The project current donates all the profits towards scaling the growth and sustainability of public goods.

3. Arbitrum

https://moonwatchcrypto.com/nearly-100-of-uniswaps-community-wants-arbitrum-on-the-ethereum-dex/
Arbitrum – build an app in five minutes.

Arbitrum is a layer 2 project built by Offchain Labs that provides Ethereum apps to scale at low cost whilst also providing software developer’s which simplified feature implementation of smart contracts. Arbitrum claims that you can build an Eth app in as little as five minutes.

Much like Optimism, the Arbitrum also doesn’t have a project token yet. That being said, the ecosystem is growing with hundreds of live applications including NFT marketplaces, Wallets, Bridges and On-Ramps making use of the quick start developer tools.

4. Starkware

https://www.theblockresearch.com/under-the-hood-of-starkware-115537
StarkWare – facilitate all kinds of transactions.

Starkware is an Ethereum layer 2 project that provides scaling solutions for applications wanting to keep transaction fees low and fast executing.

The Starkware ecosystem includes a few different sub-projects which help provide permissionless decentralised ZK-Rollups that help facilitate the transactions that accompany AMM, spot trading, NFT minting and crypto trading. Big projects such as Sorare have integrated Starkware into their infrastructure to enable minting of Ethereum-based NFTs.

Starkware doesn’t have a native token yet.

5. Uniswap

https://www.publish0x.com/crypto-adventure/the-best-uniswap-tools-to-enhance-your-trading-in-2021-xomlwly
Uniswap – apply for funding to build your app.

Uniswap is one of the leading the decentralised crypto trading protocol projects that supports thousands of DeFi applications including token swapping, staking, voting, liquidity providers and more.

You can use the Uniswap app to swap DeFi tokens directly on-chain through popular DeFi wallet providers on Ethereum, Polygon, Optimism and Arbitrum networks.

The native token for Uniswap is the UNI token, which you can use to save trading fee costs and stake in liquidity mining pools to earn yield. The UNI token also serves for decentralised governance of the project.

6. Loopring

https://blogs.loopring.org/loopring-red-packets/
Loopring – an automated execution system.

Loopring is a zkRollup Ethereum Layer 2 project that provide low-fees and high speed for trading, swapping and payments using ETH.

Loopring promotes an ‘automated execution system’ that allows users to trade cross-exchange and participate in cross-blockchain liquidity. Defined as ‘blockchain agnostic’, Loopring can integrate with any platform using smart contracts. You can use the Loopring BETA marketplace to create a Layer 2 wallet and trade DeFi tokens with ETH and USDT trading pairs.

The LRC token is native to Loopring and aids in these transactions.

7. OMG Network

https://www.thecoinrepublic.com/2021/03/31/omg-network-price-analysis-will-omg-hit-8-00-this-week/amp/
OMG Network – Enya and Boba combine.

OMG Network (also known as “OMG Foundation”) provides Ethereum with a Layer 2 Optimistic Rollup solution that reduces gas fees and improves transaction throughput for smart contracts.

A new project launched by OMG is called Boba, which is extending Ethereum Virtual Machine (EVM) smart contract capabilities specifically for DeFi and NFTs projects running integrations on external servers such as AWS to help execute sophisticated algorithms that are not possible to run on-chain.

8. ZKSpace

https://www.donanimbox.com/kripto-para/l2-labs-zkswap-v3-0-nftler-ve-odemeler-iceren-platformu-zkspacei-baslatti
ZKSpace – decreasing transaction latency and gas fees.

ZKSpace is a fairly new ZK-Rollup Ethereum Layer 2 protocol that offers near instant transactions without waiting for block confirmations.

The ZK project offers a layer 2 NFT protocol which provides NFT projects with cheaper NFT issuance, minting, airdrops and sales. 2022 should be an interesting year for ZKSpace, with lots of exciting developments scheduled, including ZKSea – an NFT Layer-2 marketplace.

The native token ZKS is used to save fees on the DeFi token swap L2 Wallet and also used to pay for minting NFTs on the L2 marketplace.

9. Skale

https://venturebeat.com/2018/10/04/skale-labs-raises-9-65-million-for-better-blockchain-infrastructure/
Skale – businesses can rent a sidechain.

Skale is an elastic blockchain network that focuses on high-performance, offering up to 1000x faster transaction speeds for your Ethereum Dapps.

Crypto projects have the option to rent a sidechain through Skale to increase transaction throughput making use of the Ethereum 2.0 validator nodes with the use of Sharding technology.

Projects can execute solidity smart contracts on Skale powered blockchains to enhances DeFi, games, NFTs and content streaming services.

SKL token is the native token of the Skale network, which aids in ecosystem cleaning, network development and upkeep, and reward validator nodes – the community keeping the network secure.

10. Gnosis Chain

https://cryptomode.com/gnosis-avoids-high-ethereum-fees-by-leveraging-the-xdai-sidechain/
Gnosis Chain – formerly xDai.

Gnosis Chain (formerly known as xDai) is a prediction market platform on the Ethereum network. Gnosis chain is providing its users with the chance to build their own prediction platform through the creation of a specific infrastructure layer.

Gnosis Chain also hosts free tournaments on the outcomes of their prediction platforms, and doing well with these can earn you GNO – the native token for the Gnosis Chain.

11. Bonus: Raiden Network

https://empresa-journal.com/2017/12/30/raiden-network-token-cryptocurrency-tried-lower-value/
Raiden Network – compatible with all ERC20 tokens.

Raiden Network is an open source project that aims to help scale Ethereum payments by providing off-chain transfer of ERC20 tokens.

While this network is currently work in progress, Raiden is looking to avoid the ‘blockchain consensus bottleneck’ to facilitate ETH micropayments, similar to that of BTC lightning network.

Currently, the project’s native token is RDN.

Conclusions

Ethereum layer 2 projects will have a big say in the short adoption of Ethereum-based projects and also in the long-term success of Ethereum as a global settlement platform.

2022 brings the long anticipated Ethereum 2.0 upgrade which many believe will not make Layer 2 networks obsolete, but actually enhance them and increase adoption into the Ethereum ecosystem. Upgrades such as sharding will become available to Layer 2 projects enabling them to improve their services to Dapps and Layer 3 apps.

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Crypto News Ethereum

Time to Long? Ether Staked in Ethereum 2.0 Surpasses 2.29M ETH

Time to Long? Ether Staked in Ethereum 2.0 Surpasses 2.29M ETH

Ethereum users have since shown a huge level of commitment to Ethereum 2.0 staking, even after the development phase 0 was launched. For this reason and more, a significant number of Ether (ETH) has been leaving the cryptocurrency exchanges, which is quite a good development for ETH in the long term, according to industry experts. Possibly, this could also be a factor contributing to the growing price of the second-largest crypto.

At the time of writing, Ether was trading at the price of US$1,226 on Coinmarketcap, a digital currency price tracking platform. The cryptocurrency now has a market capitalization above US$140 billion.

Milestone: 2% of ETH has Been Staked

According to the information shared on Thursday by Crypto Quant, a crypto analytics platform, the number of staked ETH on the Ethereum 2.0 deposit contract is worth two percent of the crypto’s current supply. This is another evidence that many Ethereum users are optimistic about the upcoming Eth2 network. That said, it’s worth noting that the current circulating supply is 114,154,295 ETH, and the staked two percent accounts for about 2.29 million ETH.

These coins staked on the Ethereum 2.0 deposit contract cannot be withdrawn, at least until the next Eth2 development phase, thereby making the coins illiquid. Many experts relayed their thoughts that such development is quite healthy for ETH. Precisely, Ki Young Ju, the CEO of Crypto Quant, recently opined on Twitter that “illiquidity makes the ETH price go higher in the long-term.” 

With the increasing staking rate for Eth2, Ki Young Ju had mentioned on Twitter that Ether “is the most undervalued asset in crypto finance.” On January 4th, all crypto exchanges’ ETH reserves decreased by 20 percent compared to May 2020. Evidently, some of these coins are flowing to the Ethereum 2.0 deposit contract, including decentralized exchanges (DEX) or for custody. 

“Whatever it is, it’s good for $ETH as decreasing market supply. Whales might use DEX for dumping, but at the same time, DEX drives Defi growth,” he added. 

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Ethereum

Lido Prepares to Launch Eth2 Liquid Staking Mainnet After $2M Funding

Lido Prepares to Launch Eth2 Liquid Staking Mainnet After $2M Funding

Before the launching of the Ethereum 2.0 Beacon Chain on December 1, a few Ethereum protocols, including Lido Finance, had revealed plans to work on solving the “illiquidity” issue with Ether (ETH) staked on the network. Today, Lido is pushing towards this development, as a tweet confirmed that Lido raised millions of dollars from prominent companies in preparation for its Eth2 staking mainnet.

Illiquidity Issue With Eth2 Staking 

Notably, the current Ethereum network is moving to a proof-of-stake (PoS) model with Ethereum 2.0. This transition is expected to be completed in four phases, one of which has been launched already. Although users can stake ETH on the network, these coins are considered illiquid due to the fact that it can’t be withdrawn, at least till the next Eth2 development phase launches. 

Judging by this, many industry experts raise concerns that this might slow down the rate of ETH staking on the network. This is because many people would prefer to lock their coins in crypto exchanges for trading or in decentralized finance (DeFi) yield farming protocols to make even more profit than staking. Besides, they can choose to withdraw these coins anytime, anywhere, unlike when they are staked.

For this reason, Lido planned to introduce a liquid staking service for Ethereum 2.0.

Lido Prepares for Mainnet Launch

The Eth2 staking service provider intends to achieve this liquidity by issuing an ERC-20 token, stETH, for any ETH staked on the network. This will serve as the tokenized version of the coins staked, as well as in value. Lido noted that stETH could be traded on exchanges and also used in DeFi protocols for yield farming. In this way, the Ethereum users have nothing to lose, as they will receive an equivalent token for any coin they stake.

With the US$2 million fundraise, Lido is preparing to debut the Eth2 liquid staking mainnet later this month. There are possibilities that this service will go mainstream in the coming year.

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Crypto News

Ethereum 2.0 Staking Redistributes ETH Held by Top Whale Addresses

Bullish? All Centralized Exchange Ether (ETH) Reserve Have Dropped to New Low

There has been a notable level of shake-off for the ten largest whale addresses holding Ether (ETH) over the past 30 days. According to the information shared by Santiment, a crypto analytics platform, the number of Ethereum coins held in these addresses has dropped significantly, although this is not reflected in the cryptocurrency’s price. One plausible reason for the decline is the Ethereum 2.0 staking.

Per Santiment, the total number of Ether held in the ten largest addresses dropped from 16.4 percent to 4.5 percent within a period of one month. Despite this massive drop, the cryptocurrency is still up by over 61.4 percent, trading at US$590 at the time of writing. This is probably because new addresses were also being created at the time, thereby causing ETH redistribution from the top addresses to the new ones – not a sell-off.

Ethereum Whale Addresses are Staking ETH

The creation of these new addresses also led up to the speculation that Ethereum 2.0 staking is a major factor causing ETH supply redistribution from the top addresses. Alex Saunders, the founder of Nugget’s News, explained this on Twitter, saying that the Ethereum 2.0 deposit contract required the network users to move the coins to a new address for the beacon chain & staking.

Backing this up is the fact that the deposit contract was actually launched last month, which is the same time the coins began leaving the whale addresses. So, more coins leaving the addresses to Eth2 staking is definitely not a thing to worry about as the crypto’s price is more likely to benefit more.

The Beacon Chain went live on December 1 with Phase 0, as Ethereum developers had estimated. This particular phase would act as the backbone for other functions to be released in the completion of the network.

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Crypto News

Ether Capital, a Publicly-traded Firm is Running an Ethereum 2.0 Validator Node

Ether Capital, a Publicly-traded Firm is Running an Ethereum 2.0 Validator Node

Following the successful launch of the Ethereum 2.0 Beacon Chain on Tuesday, a publicly-traded company, Ether Capital, announced today that it has become a validator for the new Proof-of-Stake (PoS) network. As usual, the development follows the company’s 32 ETH staking on the network. It further plans to stake more Ethereum coins as Eth2 stably develops with time.

Ether Capital is arguably the first-ever publicly-traded company to be running an Ethereum 2.0 validation node. 

Ethereum initiate first move to PoS 

The road to Ethereum 2.0 began with the deployment of the Eth2 Phase 0 on December 1, at exactly 7:00 am ET. The development numbers the days of Ethereum miners, as the PoS network would grant ETH holders the opportunity to validate transactions on the blockchain and also participate in consensus whenever they staked at least 32 ETH on the network. By doing so, ETH holders stand to gain inflationary block rewards.

The CEO of Ether Capital, Brian Mosoff, commented on the development, saying:

“The launch of Ethereum 2.0 is an exciting and historic milestone in the digital asset space, and we are thrilled to be part of it by running a validator. The transition to staking has been part of Ether Capital’s roadmap since inception and means that Ether holders are now able to generate an Ether-denominated return, or yield, by participating in-network validation.”

More to come for Eth2

Notably, Ethereum 2.0 looks so promising, and many individuals and companies are actively betting on the future progress of the network via their active participation in staking. As per Eth2 Launchpad, there is currently 971,618 ETH already staked on the network and still counting. In today’s ETH price of around US$588, the staked coins are worth US$571,311,384. 

Ether Capital further noted that it would stake more Ethereum coins on the network if it continues to function stably. Mosoff precisely said:

“Once we see the Ethereum 2.0 blockchain running in a stable fashion over a period of time and are able to fully understand and mitigate applicable risks, Ether Capital intends to make a more substantial commitment of its Ether balance to staking.”

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Crypto News Ethereum

Ethereum 2.0 Phase 0 has More Than Enough Staked ETH for Tomorrow’s Launch

Ethereum 2.0 Phase 0 has More Than Enough Staked ETH for Tomorrow's Launch

Last week, the Ethereum 2.0 deposit contract gained the required number of Ethereum coins, or ETH needed to kick-off the blockchain’s transition to the Proof-of-Stake (PoS). Although the threshold has already been met, the Ethereum community didn’t back out from locking more ETH on the network. This demonstrates a strong level of confidence the community has for the long-anticipated Ethereum 2.0 or Serenity upgrade.

Eth2 Deposit Contract has Over US$500 Million ETH

According to the information on Eth2 Launchpad, there are presently 857,728 ETH staked on the deposit contract. This is more than 60 percent the stated threshold of 524,288 ETH and currently worth over US$518 million, following the growing price of the crypto at $605 on Coinmarketcap. An Ethereum 2.0 researcher at Ethereum Foundation, Justin Drake, commented on the development, saying:

“It is a fantastic display of confidence by the Ethereum community. […] I’m proud thousands of Ethereans felt compelled to lock their funds for many months to secure Eth2.”

It’s worth noting that these cryptocurrencies can’t be withdrawn from the network for at least two years later when Phase 1.5 is deployed. Tomorrow’s Eth2 Phase 0 launch marks the first step towards the transition of the current Ethereum blockchain to the PoS era. Phase 0 is expected to launch by 12 UTC on December 1. It will enable the Beacon Chain on the network, which acts as a backbone for Ethereum 2.0.

The highly anticipated Serenity upgrade is expected to undergo about four development phases before its completion. It’s estimated that these phases might take about two years (i.e., 2022). However, there are speculations that the network might take more time to be completed, as many hurdles may possibly be encountered while being deployed.

Ethereum Nodes Surpass Bitcoin’s

Besides the upcoming Eth2 Phase 0, reports on Monday also confirmed a growing number of Ethereum nodes during these times. Currently, Ethereum has about 11,137 nodes, while the largest blockchain network, Bitcoin, has only 10,981.