Ethereum L2s Surpassed All Other Blockchains by TVL: Details

Ethereum Foundation contributor Josh Stark noticed a major achievement for Ethereum-based ecosystem of second-layer networks. In 2021, 20% of his followers were sure that this "flippening" would never happen.

Ethereum (ETH) L2s accomplished historic milestone

In the first days of 2024, the aggregated sum of value locked in Ethereum-based L2 protocols exceeded that of all non-Ethereum blockchains. While Ethereum L2s are responsible for $20.7 billion in equivalent, the rest of blockchains amassed $19.6 billion, as noticed by Stark today, Jan. 4, 2024.

Meanwhile, he stressed that the metrics cannot be treated as exactly similar: For second-layer networks, the indicator refers to the sum of assets on L2, including native tokens. For L1s, the metrics reflect the sum of assets locked in dApps on this or that blockchain.

The analyst used L2Beat's data for tracking second-layer blockchains and DefiLlama to analyze what is happening on non-Ethereum L1s.

It is interesting that back in September 2021, he asked his audience about the date of this "L2-over-L1" flippening. While the majority of his followers were sure that this fact could take place in 2022, 20% answered that it would never happen.

The L2s ecosystem was 20 times smaller than the L1s one, as of the date of the first voting. During the crypto winter, this gap became even more dramatic; its peak was reached amid the Terra/Luna collapse in Q1, 2022.

Arbitrum (ARB) dominance inches closer to 50% again

As demonstrated by L2Beat, the ecosystem of Ethereum's L2s registered an all-time high in TVL on Jan. 2, 2024. The metric jumped above $20.78 billion in equivalent, adding over 330% in just one year.

The L2s scene remains heavily "concentrated": Only five networks — Arbitrum (ARB), OP Mainnet (Optimism, OP), Base, Metis Andromeda and Manta Pacific — are responsible for over 90% of its TVL.

Arbitrum (ARB), the largest Ethereum-based L1, is rebuilding its dominance after a small decline. As of printing time, it is one step away from the 50% barrier.

For the closest competitor, OP Mainnet, this indicator equals 28.65%, L2Beat data says.