Main Points :
- Anatoly Yakovenko, co-founder of Solana, argues that claims that Layer 2 networks inherit the security of Ethereum are erroneous.
- He points to the large attack surface, complex codebases and reliance on multisig custody models in many L2s as key vulnerabilities.
- According to analytics site L2Beat, over 129 verified Ethereum L2 networks exist (with another ~29 under review), raising questions about fragmentation and redundancy.
- While L2s drive scalability and user-activity growth for Ethereum, they may cannibalize L1 fee revenue and reduce ETH burning — potentially undermining the economic model of Ethereum.
- From a practical investor or blockchain infrastructure standpoint: understanding the risk-tradeoff of L2 adoption — security vs scale vs decentralisation — is crucial when evaluating new assets or protocols.
The Claim Under Fire – L2s and Ethereum Security
In a recent public debate, Anatoly Yakovenko, co-founder of Solana, challenged the widely held assumption that Layer 2 (L2) networks built on Ethereum automatically “inherit” the security guarantees of Ethereum’s layer-1 (L1) chain. He declared that “the claim that layer-2s inherit ETH security is erroneous.”
Yakovenko’s argument rests on several key points: many L2s have expansive attack surfaces due to large codebases, making comprehensive security auditing difficult. He noted that some L2 systems rely on multi-signature (multisig) custodial arrangements for their bridge- and state-post mechanisms, meaning assets can potentially be moved without direct user consent.
He also contrasted L2 networks such as Wormhole ETH on Solana and Base, on which he argued users bear “the same worst-case risk” as Ethereum L1 stakers, yet these L2s are producing yields similar to ETH staking. He concluded that from any perspective, the logic that L2s inherit ETH’s security simply doesn’t hold.
For readers interested in evaluating new crypto protocols or layered infrastructure, this critique is important: scaling solutions may deliver throughput and lower fees but may bring their own unique risk vectors.
The L2 Explosion – Scale, Diversity and Fragmentation
According to L2Beat, the number of verified Ethereum L2 networks stands at 129, with another ~29 pending review. Some industry voices suggest this proliferation is excessive: for example, Adrian Brink (co-founder of Anoma) claimed there are “ten times more L2s than necessary.”
On the flip side, proponents argue the diversity of L2s is healthy for the ecosystem. For instance, Igor Mandrigin (co-founder of Gateway.fm) said the proliferation is a sign of Ethereum’s ecosystem growth and the availability of high-throughput options for developers.
Thus, for a blockchain investor or infrastructure person looking for “the next asset” or “practical application”, the large number of L2s provides many options — but also raises questions about which ones will thrive, which will consolidate, and which may face security or economic headwinds.
Economic and On-chain Implications for Ethereum
Beyond the security debate, the rise of L2s has tangible economic and on-chain consequences for Ethereum. According to an analytics study, while L2s contribute to increased active addresses and transactions (good for ecosystem activity), they also reduce the amount of ETH burned and lower the rent paid to Ethereum’s base layer, weakening ETH’s deflationary model and reducing revenue for L1 validators.
For example, the study notes that after the March 2024 Dencun upgrade (which introduced data blobs via EIP-4844), rent payments from L2s to L1 dropped by ~99%.
From an investment perspective, this implies that while L2 networks may offer new yield or utility opportunities, they might also create headwinds for Ethereum’s native economics — which you should factor in when evaluating ETH-based projects or ecosystem tokens.
Practical Takeaways for Crypto Investors and Developers
For our audience interested in discovering new crypto assets, income opportunities, and real-world blockchain use cases, these themes carry actionable implications:
- Risk assessment of L2 protocols: Don’t assume safety simply because a network is “on top of Ethereum.” Investigate their security model (sequencer structure, exit/escape hatches, custody model, multisig risk). For example, many rollups have varying exit windows, sequencing centralisation, or dependencies on bridges.
- Tokenomics and incentive alignment: When evaluating an L2 network or related asset (token), consider whether its growth could erode value in its parent chain (e.g., ETH) or whether it aligns incentives across stakeholders (users, stakers, developers).
- Scalability vs decentralisation: A network may provide high throughput, low fees and vibrant dApp activity, but if it relies on centralised sequencers or custodial models, it may inherit vulnerabilities. Weigh these trade-offs — especially for DeFi and income-generating protocols.
- Ecosystem consolidation potential: With >129 L2s, it’s likely that some protocols will falter, be absorbed, or consolidate. From the “finding the next big asset” perspective, identifying which L2 network has unique value proposition (e.g., best tooling, lowest fees, strongest decentralisation) may be more rewarding than taking all L2s at face value.
- Impact on Ethereum’s broader model: If L2s continue to draw liquidity and lower ETH burning, this may reshape the economics of ETH staking, yield expectations, and the long-term value of ETH-based protocols. For someone designing a wallet, dApp or integrating swap functionality (such as your ‘dzilla Wallet’), this suggests that supporting cross-L2 flows and considering where yield comes from is strategically valuable.
Emerging Trends and What to Watch
- Monitor exit/withdrawal security mechanisms of L2s (how quickly can users recover funds, how decentralised is the sequencer).
- Track TVL (Total Value Locked) and activity metrics of L2 networks, and compare to risk. For example, L2Beat shows one major L2 has ~$18.56 billion in value secured.
- Observe the fee-sharing model between L2 and L1, especially whether reductions in rent/fees undermine underlying chain economics.
- Keep an eye on cross-chain yield strategies: users chasing yield on L2s must factor in the above risks (e.g., multisig custody, bridge dependencies).
- Considering your wallet work (BTC-ETH swaps in a non-custodial wallet scenario), understanding which L2s are strategically important (and their security posture) can help decide what networks to support, how to display risk disclosures, and how to structure swap UX to show users trade-offs (speed vs security vs decentralisation).
Conclusion
The critique by Anatoly Yakovenko raises a critical reminder: scalability in blockchain (via L2s) doesn’t automatically equate to inheriting base-layer security. For those exploring new assets, seeking yield, or building blockchain infrastructure, the rapid expansion of Ethereum’s L2 ecosystem offers both opportunity and caution. On one hand, L2s continue to deliver real value — higher throughput, lower fees, developer ecosystems. On the other hand, they introduce new complexity, centralisation vectors, economic shifts in parent chains, and potentially heightened risk for user funds.
In the context of discovering the “next revenue source” or “practical blockchain implementation,” the key is due diligence: assess security models, tokenomics, ecosystem health, and strategic positioning — rather than assume all L2s are equivalent. For someone designing a wallet or swap product, exposing these considerations transparently can differentiate your UX and build trust.
As Ethereum continues evolving, and as L2s proliferate, the winners will likely be those that strike the optimal balance: scalable, secure, decentralised, and economically aligned. Investors and developers who focus on these dimensions may find the highest-value opportunities — and avoid those that rely purely on scale without strong foundation.
