Originally published on: September 17, 2024
Ethereum co-founder Vitalik Buterin dropped a bombshell on the crypto community on Sept. 12, declaring that any network purporting to be a “layer 2” must achieve “Stage 1” status by the end of the year – or face expulsion from the coveted classification.
In his bold statement, Buterin emphasized, “The era of rollups being glorified multisigs is coming to an end,” and proclaimed, “the era of cryptographic trust is upon us.”
This distinction of being labeled a layer 2 network holds significant weight within the Ethereum ecosystem, as it determines whether a network relies on Ethereum’s security and can be trusted to safeguard users’ funds, or if it functions as a stand-alone entity, potentially leaving funds vulnerable.
The issue gained prominence after the decentralized finance project Velocore fell victim to a $2.6 million exploit on the Linea network, which touted itself as an Ethereum layer 2. The abrupt halt in block production following the attack sparked debates on the actual security measures of layer 2 networks that rely on Ethereum.
According to Buterin’s earlier comments on the matter, all Ethereum layer 2 networks must reach “Stage 1” by 2024 to maintain their layer 2 title. But what exactly is Stage 1?
Stage 1 introduced by Buterin in 2022, sets a benchmark for decentralized networks to begin their journey towards full decentralization. By providing a framework for layer 2 networks to progress from centralization to eventual permissionless operations, Stage 1 acts as a pivotal milestone in ensuring censorship-free transactions.
Despite Buterin’s stringent criteria, only a handful of networks have managed to achieve Stage 1 status as of now. Among these pioneering networks, Arbitrum One, Optimism, DYdX v3, ZKsync Lite, DeGate v1, and Fuel v1 have distinguished themselves by meeting the rigorous guidelines outlined by Buterin.
While these networks have set a new standard for layer 2 networks, others are still racing against time to upgrade their systems. Networks like Coinbase’s Base, Blast, ZKsync Era, and Starknet are striving to meet the Stage 1 criteria before the deadline.
However, several networks, including Scroll and Linea, have yet to even reach Stage 0, despite locking significant crypto assets within their ecosystems. These networks face the risk of losing their layer 2 classification if they fail to meet Buterin’s stringent standards by the end of the year.
As the crypto landscape evolves, the distinction between layer 2 networks and their adherence to security measures will continue to play a crucial role in shaping the future of blockchain technology. The ongoing race to achieve Stage 1 status underscores the industry’s commitment to decentralization and trustless transactions.
In a bid to keep pace with Buterin’s vision, layer 2 networks are accelerating their efforts to enhance security, foster decentralization, and uphold the mantle of layer 2 status. The coming months will undoubtedly witness a transformational shift in the Ethereum ecosystem as these networks strive to meet the stringent requirements and make the cut as true layer 2 networks.
