Layer 2 protocols like Arbitrum, Optimism, and ZkSync have shown substantial growth since they were introduced. The cryptocurrency market is currently experiencing volatility due to the tensions between Israel and Iran, but Layer 2 protocols continue to thrive.
The total market cap of Layer 2 protocols is now around $22 billion, with a 4% increase in the past 24 hours. However, the total traded volume has decreased by 38%.
Let's delve into the top 5 Layer 2 protocols to examine their performance.
ZkSync ( Lite+Era)
zKSync is a layer 2 protocol that boosts Ethereum with its innovative ZKTech and Roll-Ups technology for 100% security. There have been over 230 million transactions on this network, along with more than 1 million contracts and over $6 million deployed.
The Total Value Locked (TVL) for ZkSync Era is $157 million, and the stablecoin market cap for Lite is $14.65 million. The net inflow for the protocol has been steady around $5 million.
Source: Defilama
The Total Value Bridged (TVB) across supported protocols is approximately 3,530,340 ETH, with 2,841,295 total bridgers. The daily bridge volume has remained stable, and analysts are predicting an increase in TVB in the future.
StarkNet Bridge
Starknet offers a secure scaling technology for Ethereum and ensures computational integrity through stark technology. The protocol has seen significant growth since Feb 2024.
Overall core developers have remained stable, with derivative volume surging by 200% to reach $1.33 billion. TVB for the protocol is at 897,575 ETH, with 159 bridgers in the last seven days. The NOSTRA chain of the Starknet has the highest bridges with a TVL of $169 million.
Arbitrum
Arbitrum is the third-largest layer 2 protocol with a market cap of $3.2 billion. It allows developers to utilize Ethereum security for next-gen dApps. The ARB token has seen growth since the start of 2024.
Fee collection from the protocol has decreased to $20k in April 2024, with average revenue around $15k. Arbitrum's TVB has remained relatively stable, and analysts anticipate an increase in the future.
Optimism
Optimism leverages Optimistic rollups to scale Ethereum and is home to over 150 protocols. It has an overall TVL of $864 million.
Revenue has grown slightly, with an average of $40k. The overall inflow has been negative in recent months, and the number of depositors on the protocol has decreased significantly. The total ETH deposited has remained steady.
Conclusion
Layer 2 protocols are seeing growth in market cap and ecosystem development, aiming to expand the scale of Ethereum in the future. Analysts predict a potential 5x increase in layer 2 protocols in the coming years.
Disclaimer
The views expressed in this article are for informational purposes only and do not constitute financial or investment advice.
