Competition Between L2 and Solana: The Importance of Opening New Tracks

Currently, some mainstream L2 solutions face a common challenge: they overly mimic the DeFi model of Ethereum L1, leading to a certain degree of path dependence. However, L2 has its unique characteristics and should explore new paths suitable for high-performance demand applications. What the market truly needs is not a simple copy of Ethereum L2, but a completely new direction for L2 development.

These new directions should focus on high-frequency applications. Just like Solana's efforts in the DePIN (Decentralized Physical Infrastructure Network) space, repeating old paths is unlikely to inspire explosive growth. The insights of the Solana ecosystem in this regard are commendable, which is also somewhat related to its investment background. Ultimately, new attempts bring new narratives, which in turn ignite the market.

So, how do mainstream L2 projects compete with Solana? The key is not to focus all your energy on replicating Ethereum L1 DeFi. While this area is still important, it is not the key to breakthroughs.

The most crucial thing is to create new narratives. We should look for breakthroughs in areas such as Web3 games, artificial intelligence, and DePIN. At the same time, we urge developers not to be limited to creating old solutions, but to strive to open up new battlefields. Even if we have to settle for second best, vigorously developing DePIN is also a feasible direction.

In addition, these L2 projects need to allocate valuable economic resources (such as tokens) to support projects and developers in new tracks. The L2 ecosystem has a latecomer advantage in token economics and is fully capable of designing ecosystem incentive programs that are superior to those of traditional public chains.

The breakthrough of Solana is a great example for mainstream L2 projects and should be learned from rather than underestimated.

If these L2 projects can launch several blockbuster applications in fields such as Web3 gaming, artificial intelligence, or DePIN after the Cancun upgrade in the first half of next year, the situation may change.

The real competition between L2 projects and Solana may fully unfold in the second half of next year, and we might see a clear winner or loser within the next two years. This is a long cycle, and there is no conclusion yet.

The Ethereum ecosystem should also thank the innovative breakthroughs on Bitcoin and Solana. Without this healthy competition, the Ethereum network might become too complacent. The stimulation from the Bitcoin and Solana ecosystems is enough to attract the attention of the Ethereum community. The most important thing is not to underestimate or antagonize, but to learn from the breakthroughs of other ecosystems. Only in this way can we continue to move forward. Ethereum has historically faced numerous doubts, and I believe in the resilience of Ethereum's ecosystem developers and community to meet these challenges.