L2s' Competition& Culture: How Asymmetric Info Shapes the Landscape

Asymmetric information theory is presented as a way to explain the competition and collaboration problems facing Ethereum layer-2 networks. Citing Dune data from jhackworth (2024), it reports that L2s rose from nearly 60% to over 80% of Ethereum transactions after March 2024, while L2 fees fell sharply after a late-March 2024 peak, reducing their revenue. Citing Coinbase, it says web3 developers make up less than 1% of the 31.1M software developers globally. It also cites Notheisen and Weinhardt (2019), who found that blockchain lets bad actors claim high-quality "plums" first.