The crypto Layer-2 landscape is witnessing a dramatic reshaping. Recent market data reveals significant shifts in decentralized finance (DeFi), with networks like Optimism and Base making substantial gains while Ethereum sees declining transaction counts on decentralized exchanges (DEXs).
Optimism, in particular, has emerged as a leader in cross-chain value movement. On April 8, 2024, an impressive $410 million flowed to and from the network, representing nearly 40% of all value transferred across major blockchains that day. The average value per transaction also hit a notable 0.22 ETH.
[Optimism leads chains in value transferred chart]
This surge highlights Optimism’s growing appeal for efficiently moving liquidity between different Ethereum Layer-2 solutions. Its success heavily relies on the open-source OP Stack technology, fostering interoperability. This shared foundation simplifies interactions between networks like Base, Mantle, Worldcoin, and Celo, creating a more connected Layer-2 ecosystem.
Base, also built using the OP Stack, leverages this interoperability and is now dominating DEX activity. Data shows Base accounting for 60% of all DeFi transactions recently. Arbitrum holds the second position with roughly 25%.
Concurrently, Ethereum’s share of DEX transactions has continued to shrink, dropping to just 7% on April 7, 2024. This trend suggests users are migrating activity to Layer-2 networks, likely seeking refuge from Ethereum’s higher transaction costs (gas fees).
This migration directly impacts network revenue. Base reportedly earned 211 ETH in fees on April 7, closely followed by Arbitrum with 170 ETH, showcasing the financial implications of attracting transaction volume.
Despite losing ground on transaction counts, Ethereum maintains its lead in total DEX trading volume. It still commands 60% of the approximately $3 billion traded daily on DEXs. Base follows with 20%, and Arbitrum captures about 15%, indicating that larger value trades may still favor the mainnet, while smaller, frequent transactions migrate to Layer-2s.
The dynamic interplay between Layer-1 and Layer-2 solutions continues to evolve, driven by user demand for efficiency and lower costs in the DeFi space.