Are Alt-L1s over? Security, costs drive smaller chains to Ethereum
L1 blockchains Zilliqa, Gnosis and Ronin join the Ethereum ecosystem as the costs of going it alone grow, and the security and liquidity advantages become too hard to resist.
Smaller L1 blockchains like Zilliqa, Gnosis, and Ronin are moving away from their standalone architectures to join the Ethereum ecosystem, driven by rising costs and the growing appeal of security and liquidity provided by Ethereum. These smaller networks were once praised for their promise of control and self-governance, but maintaining an entire ecosystem has become increasingly challenging.
As Zilliqa recently announced its plans to become an Ethereum-based Layer 2, other projects like Gnosis Chain and Ronin have also begun transitioning back to Ethereum, with the latter doing so as a Layer 2 in May. While Ethereum faces criticism for redistributing its revenue to L2s, its appeal for new projects is undeniable due to its robust infrastructure and active community.
However, just moving to an Ethereum L2 doesn't guarantee profitability, as demonstrated by networks like Optimism, Katana, and Linea. The Gnosis Chain initiative aims to complete its shift to the Ethereum Economic Zone (EEZ) in spring 2027, allowing for seamless interoperability and tapping into Ethereum's liquidity. Despite concerns, some believe that Ethereum's centralized nature could ultimately benefit the entire blockchain ecosystem, as it provides a more secure and cost-effective environment for applications and developers.
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