I gotta say that I find it crazy that the Ethereum community is discussing this now. Martin Köppelmann was already talking about this in November at Devcon in Bangkok and made it very clear that there's a huge question mark around L2 issuance of tokens and by reading all the replies of the main influencers like Hayden from Uniswap and other people working on OP, I'm surprised that there is no definitive answer to this issue that must have been known since for much longer than just November 2024 and even when L2s really started to advertise L2 token issuance. So to me this is crazy that the problem is publicly discussed now. It almost seems like it needed to become common knowledge for people to admit this as a core problem.

Martin‘s talk: https://news.kiwistand.com/stories/Koppelmann:-Ethereum-needs-native-L2s?index=0x674609ce714b6b83a18e0bd9900e49af9430fba8814031c825f934053a7868eb40bb49c0

That was such a good talk - yet a shame it seemingly didn't go very far in terms of translating into some sort of action. Even though he did probably very consciously focus on using tech we already have for the proposed solution.

As a funny side anecdote, I am atm in a 6-day waiting period to get a token from Arbitrum to Ethereum with their native bridge. That liquidity isn't even fragmented it's just "stuck" ha

I think it was Galen who proposed to me the idea that maybe this time, it’s just the crime cycle. Even though I pledged allegiance to only telling the positive visions of Ethereum just a week ago, I can’t help but feel disappointed—and also prompted to say a few things about the admission of the pretty much apparent issues with the Layer 2 roadmap.

As early as November, and even before that, we were discussing in the Kiwi News Telegram channel that native L2 issuance wouldn’t allow you to reliably withdraw tokens from L2 to mainnet. Additionally, many builders have unknowingly built on an L2, not realizing that their data will soon be stored on EIP-4844 blob data—whereas before, it was retrievable in perpetuity by being stored in call data. In this regard, L2 developers have knowingly allowed people to ship applications on L2 for use cases it was explicitly not designed for, even when updates were shipped that violated prior invariants.

If I were to summarize the entire situation, it almost feels as if the Ethereum community was truly caught off guard by Solana’s rise. They panicked and simply went with the flow, despite not being technically ready. I call this the crime cycle because, only after many admissions from those in the outer circles of the Ethereum community, did we finally get Vitalik, on Valentine’s Day, to acknowledge the issue. That, in turn, sparked discussions among Crypto Twitter and renowned L2 researchers.

This surprises me because the issue is so fundamental to using L2s that, at least in my mind, it should have been widely discussed the moment a community member first raised it publicly. Instead—while I don’t want to accuse anyone of malice—it seems strange that this wasn’t widely picked up during, for example, Martin’s talk. That said, the talk was somewhat convoluted, Martin is admittedly not the best speaker, and the rooms at Devcon weren’t always full. Still, in the Kiwi community, we discussed this extensively, including the fact that all non-settled data stored on L2s will no longer be retrievable in perpetuity after the blobs launch. Yet, I have yet to see anyone propose a solution to that problem—whereas on Solana’s L1, it has already been addressed.

I hope this cycle won’t go down in history as a historic underperformance of ETH, with Ethereum researchers caught off guard, unprepared, and panicking in the face of Solana’s rise—only to find themselves exposed once the cycle is over. Today, it certainly looks like ETH’s underperformance is technically justified, given how many issues L2s still have. The current Ethereum roadmap—proposals like Beamchain, snarkification—feels like a slap in the face to app developers. They just want to use this technology now; they don’t want to wait a few more years for it to be ready. In fact, I’m sure that if ETH researchers drastically reduced the scope, focused on making things work quickly, and provided users and developers with the necessary security guarantees, these issues could be solved fairly soon. However, I don’t think it’s in the nature of the Ethereum research community to hotfix issues like this. Instead, they tend to take a long time and then ship one major update, as they did with proof-of-stake and the Merge.

All of this said, this entire cycle so far has been about how the underlying technology does not matter for the price to rise.