Ethereum’s Scaling Journey
Ethereum is embarking on a scaling journey that involves deploying a variety of layer-2 (L2) networks, each characterized by distinct speed and operational parameters. This strategy, as explained by Anurag Arjun, co-founder of Avail—an innovative solution designed for unified blockchain environments—means that Ethereum could potentially support an unlimited number of specialized high-throughput chains.
Differentiation and Strengths
In a recent conversation with Cointelegraph, Arjun pointed out that Ethereum differentiates itself from its high-throughput counterparts that adhere to a monolithic framework. He emphasized that Ethereum’s embrace of a diverse range of L2 solutions fosters an often overlooked yet significant strength:
The under-appreciated beauty of this rollup-centric roadmap architecture is that it empowers multiple teams to experiment with varying execution environments and block times.
This experimentation facilitates the development of a wide array of high-performance sidechains rather than confining the network to a single structure as seen in traditional layer-1 systems, as per Arjun’s insights. Nevertheless, he cautioned that without robust interoperability standards, the challenges of transitioning between different L2 networks would continue to mirror the complexities involved in moving assets across diverse blockchain ecosystems.
Criticism of Ethereum’s Strategy
Interestingly, this perspective contrasts with the skepticism expressed by some critics of Ethereum’s strategy, who contend that the network’s focus on L2 solutions leads to liquidity fragmentation and undermines the fundamental layer’s integrity. These detractors also believe that the proliferation of L2s has contributed to Ether’s sluggish price movement over the past year.
Recent Developments
In a related development, Ethereum’s layer-1 fees have plummeted to their lowest levels in the last five years, reaching an average transaction cost of approximately $0.16 in April 2025. Brian Quinlivan, marketing director at analytics provider Santiment, noted that this decline may indicate a reduced interest in the Ethereum network among investors, suggesting a downturn in base layer demand.
According to Quinlivan, this drop in fees correlates with a decline in user activity regarding ETH transactions and smart contract interactions, which encompass activities in sectors like decentralized finance and non-fungible tokens (NFTs).
The downturn in transaction fees and diminishing retail participation has prompted several institutional investors to reduce their Ether holdings, leading to revised forecasts for the cryptocurrency, which remains the second-largest by market capitalization.
