Ethereum Cancun Upgrade One Year Later: Layer2 Ecosystem Restructuring and TVL Growth Logic

In March 2024, Ethereum completed its most milestone upgrade since The Merge—the Cancun-Deneb upgrade. The core of this upgrade was EIP-4844 (also known as Proto-Danksharding), which for the first time extended Ethereum's data availability layer to Layer 2 networks, injecting new technological momentum into the entire Ethereum scaling ecosystem. Now, a year since the Cancun upgrade, the Layer 2 track has experienced key transformations from technological breakthroughs to ecosystem expansion, with leading protocols like Arbitrum and Optimism achieving significant progress in TVL, user growth, and network adoption. This article provides an in-depth review of Layer 2 development one year after the Cancun upgrade, analyzing the growth paths and challenges of major protocols.

Cancun Upgrade: A Technology Watershed for Layer 2

Before the Cancun upgrade, Layer 2 networks, while already holding an important position in the Ethereum ecosystem, faced dual bottlenecks in cost and performance. The introduction of EIP-4844 changed this situation. This proposal creates "blob-carrying transactions" that submit Layer 2 transaction data to the Ethereum mainnet more efficiently and at lower cost, theoretically reducing Rollup gas fees by more than 10 times.

The significance of this technological breakthrough lies not only in cost optimization but also in providing infrastructure support for further Layer 2 network innovation. After the Cancun upgrade, Layer 2 network theoretical throughput increased from approximately 15-20 TPS to hundreds of TPS, with some networks even claiming to reach thousands of TPS. This created conditions for the large-scale落地 of high-throughput application scenarios like DeFi, gaming, and NFT on Layer 2.

According to market data, the year following the Cancun upgrade was a period of rapid Layer 2 ecosystem expansion. Industry data shows that overall Layer 2 TVL grew significantly from approximately $10 billion before the upgrade. This growth is both a result of technological drivers and a reflection of renewed market confidence in Ethereum's scaling solutions.

Pattern Restructuring: Arbitrum and Optimism's Leadership Path

Arbitrum: Ecosystem Expansion and Differentiated Competition

After the Cancun upgrade, Arbitrum, leveraging its first-mover advantage and mature ecosystem layout, continued to dominate the Layer 2 track. Arbitrum One and Arbitrum Nova serve different application scenarios—the former positioned as a general-purpose Rollup, while the latter targets social and gaming scenarios requiring higher data availability.

In terms of ecosystem construction, leading DeFi protocols on Arbitrum such as Uniswap, Aave, and Curve have all completed deployment, forming a relatively complete financial infrastructure. Additionally, Arbitrum actively promotes ecosystem incentive programs, using ecological funds distributed by the Arbitrum Foundation to attract developers and support early-stage projects. In 2024, Arbitrum also announced its next-generation sequencer plan, aiming to further enhance network security and censorship resistance through decentralized sequencing.

According to TVL data, Arbitrum's share of total Layer 2 TVL remains at a relatively high level. Based on industry tracking data, its TVL has consistently ranked among the top Layer 2 networks, making it an indispensable core component of the Ethereum Layer 2 ecosystem.

Optimism: OP Stack Ecosystem Synergy

Unlike Arbitrum's ecosystem expansion strategy, Optimism chose a differentiated approach centered on technology stack output. OP Stack is a modular, scalable Rollup infrastructure launched by Optimism, designed to help other projects quickly deploy their own Layer 2 networks. Through OP Stack, Optimism has built an ecosystem vision called the "Superchain," allowing multiple Layer 2 networks to share sequencers and proof systems, thereby achieving interoperability and scale effects.

After the Cancun upgrade, OP Stack adoption increased significantly. Base Chain, as the first mainnet-level Layer 2 network built on OP Stack, has maintained strong growth momentum since its launch. Base Chain, backed by Coinbase's custody and leveraging deep integration with mainstream centralized exchanges, has attracted a large number of retail users and developers. Additionally, networks like Zora Network and Mode, built on OP Stack, have also launched, further expanding the Optimism ecosystem's footprint.

In terms of token economics, Optimism completed its OP token airdrop distribution and ecosystem incentive program in 2024, incentivizing early participants through retroactive airdrops and Grants programs. This initiative effectively enhanced community engagement and further solidified Optimism's competitive position in the Layer 2 track.

Other Layer 2 Competition and Challenges

While Arbitrum and Optimism lead the pack, new competitors have also emerged in the Layer 2 track. ZK Rollup-based Layer 2 networks like Starknet, zkSync, and Polygon zkEVM accelerated mainnet deployment in 2024, striving to secure a position in the Ethereum scaling ecosystem.

ZK Rollup technology theoretically offers higher security and faster finality, but currently still faces challenges such as high proof generation costs and immature developer toolchains. Starknet employs the STARK proof scheme, focusing on providing a high-performance programming environment for developers; zkSync Era attempts to lower entry barriers for average users into Web3 through its native account abstraction functionality.

However, according to market data, despite the enormous technological potential of the ZK Rollup track, there remains a significant gap in TVL and ecosystem adoption compared to Optimistic Rollup. Industry analysis suggests this discrepancy may persist for the next 1-2 years until ZK technology further matures and achieves cost optimization.

TVL Growth Logic: Multi-Dimensional Factors

Layer 2 TVL growth is driven not by a single factor but by a combination of technology, incentive mechanisms, and market confidence.

First, cost optimization brought by the Cancun upgrade is the fundamental factor. EIP-4844 significantly reduced Layer 2 transaction fees, causing users and funds previously stranded on the Ethereum mainnet due to high Gas fees to begin migrating to Layer 2. This migration trend was particularly pronounced in the DeFi sector—liquidity for leading protocols like Aave and Uniswap on Layer 2 increased significantly.

Second, the intensive launch of ecosystem incentive programs is the catalytic factor. In 2024, multiple Layer 2 networks launched dense ecosystem incentive programs, including retroactive airdrops, liquidity mining, and Grants programs. These programs attracted users and liquidity providers to Layer 2 networks through token incentives, creating a positive flywheel effect.

Third, institutional adoption and infrastructure improvement are long-term factors. As more institutional-level custodians and compliant frameworks support Layer 2 networks, barriers for traditional financial institutions to participate in the Ethereum ecosystem have further lowered. Some Layer 2 networks have begun exploring enterprise-level application scenarios, providing incremental space for long-term TVL growth.

Challenges and Outlook: The Next Phase of Layer 2

Despite the significant development achieved by Layer 2 after the Cancun upgrade, challenges are equally noteworthy.

On the technical level, sequencer decentralization is the most core current issue. Most Layer 2 networks still employ centralized sequencers, posing single point of failure risks and censorship risks. Although Arbitrum and Optimism have announced decentralized sequencer roadmaps, actual implementation still requires time.

On the user experience level, cross-Layer 2 interoperability and account abstraction still have room for improvement. Although technologies like OP Stack and Arbitrum Nitro have made progress in cross-chain bridging, the cost and complexity for users to transfer assets between different Layer 2 networks remain higher than expected.

On the competitive landscape level, Ethereum Layer 2 faces competitive pressure from other public blockchains. High-performance public chains like Solana, Aptos, and Sui still maintain advantages in specific scenarios. Layer 2 needs to continuously strengthen its differentiated competitive position in Ethereum's security and ecosystem integration.

Looking ahead, as ZK Rollup technology matures and Ethereum undergoes further upgrades (such as the planned Full Danksharding), Layer 2 performance and cost advantages are expected to further amplify. Ethereum's Layer 2 strategy has evolved from an "scaling patch" to "core infrastructure," a transformation that will continue reshaping the entire cryptocurrency industry landscape in the coming years.

Risk Warning

The above content is for reference only and does not constitute any investment advice. The cryptocurrency market experiences violent fluctuations, and Layer 2 protocol and token investments bear relatively high risks, including but not limited to smart contract risks, technical risks, regulatory risks, and liquidity risks. Investors should fully understand the technical mechanisms and risk factors of related protocols before making any investment decisions, and proceed cautiously based on their own risk tolerance.

The data and market information in this article are compiled based on public sources and may have lag or inaccuracies. Readers should independently verify the relevant information.