Layer 2 projects are going to play a significant role in crypto's user reach
Layer 2 is really where the magic happens.
Some time back, I stumbled on this conversation about the potentials of layer 2 projects, specifically centered on how they are the structures that will draw a lot of value to the ecosystem. This conversation in mention was talking about Hive and its layer 2 projects, so, judging from what has been going on in the space, it really does ring a bell because when you look at Splinterlands, you see a whole gaming community captured and drawn to the chain and when you see Leothreads, you see how LeoFinance has evolved from bring "finance centric" to attracting more Hive end users to leverage the frontend from day to day.
When you think about it, it really is where the value stream comes from, I mean, let's look at Ethereum, thousands of applications and smart contracts running on the network, this directly reflects on the number of users the blockchain has amassed and frankly not many of them care about Ether as a base layer network token, but somehow, they get to utilize it from time to time given that these layer 2 applications require it to best serve the users.
Spread out developments
Over the last months to a year, I've seen a handful of projects being teased, others being launched and some being in the theoretical phases, during this period too, we saw Hive grow exponentially, an event that took literally everybody by surprise, but this is actually what happens when you "build".
All of this points us to the fact that things are moving in the right direction so we should be moving into a time where we'd talk less about marketing from the base layer focus as these layer 2 projects will rise to build numerous applications and services that captures the users in the crypto ecosystem.
This is all pretty easy to factor in or what's the right phrase to use "easy to determine its outcome" but how?
Well, the thing about getting more people working on one thing or the other is that we are effectively building more environment for engagement. It doesn't matter if majority of these applications barely earn a thousand users, the fact that we have more of them running means we're effectively climbing up tens of thousands to millions of users for the base layer.
That said, the reality also remains that not all projects will underperform, a couple will always come out strong which means more sustainable platforms will emerge, causing more in-flow of value in the ecosystem. When you look at how bitcoin started, then there was Ethereum and numerous forks of bitcoin and ethereum, and the break out of new blockchain networks, although all are not necessary tied to the same blockchain, altcoins blockchains can be somewhat considered a layer 2 technology to bitcoin, judging from the current crypto markets capitalization, these altcoins make up over 50% of the industry's market cap and if we look at Ethereum more deeply, we should discover that a handful of its value comes from layer 2 projects.
What this means is that the future holds a lot for layer 2 projects and applications as they will play a significant role in crypto's growth and mass utility.
Posted Using LeoFinance Beta