OP, Arbitrum, Starknet , ZK - and the battle for L2 domination

Blockchain technology has revolutionized the way we transfer value and store information. However, the current infrastructure of most blockchains, including the first-generation blockchains such as Bitcoin and Ethereum, suffer from scalability issues and high transaction fees. This has given rise to the development of layer 2 solutions, which aim to address these limitations while still utilizing the security of the underlying blockchain.

Layer 2 solutions are designed to operate on top of existing blockchain networks, offering faster and cheaper transactions while maintaining the security of the underlying blockchain. These solutions use various techniques such as off-chain transactions, sharding, and side chains to increase the transaction speed and lower the cost of transactions.

One of the most promising layer 2 is the Ethereum scaling solutions, which aims to increase the transaction speed and lower the cost of transactions on the Ethereum network. Some of these solutions include the Optimistic Rollup, Zk-Rollup, and Validation as a Service. These solutions use various techniques such as off-chain transactions and sharding to increase the transaction speed and lower the cost of transactions on the Ethereum network.

Investing in layer 2 solutions is a good opportunity for us at 22/7 as this technology has the potential to drive mass adoption of blockchain applications. With faster and cheaper transactions, layer 2 solutions will make it easier for businesses and individuals to use blockchain technology for various use cases, such as remittances, micropayments, and decentralized finance applications.

Taking the example of Optimism - funded by a16z and seeing strong developer adoption, we can see an increase in projects deployed, developers on the platform and transaction volume. All of these signals are leading indicators for us as 22/7, signaling protocol adoption and subsequently potential to unlock investment opportunities in Optimisms native token $OP.