The emergence of layer 2 (L2) solutions for Ethereum has prompted some industry commentators to express concerns about market fragmentation, suggesting we have reached a saturation point. However, this perspective overlooks the increasing necessity for specialized infrastructure as sectors like banking and logistics gradually adopt blockchain technology. Large enterprises prefer dedicated chains over general-purpose layer 1 (L1) solutions due to the need for custom performance, regulatory compliance, and privacy. The argument that L2 proliferation is a temporary trend is misguided; it represents a solid shift towards modular blockchain architecture. As advancements in rollup technology and layer 2 development continue, launching and maintaining dedicated chains will become more accessible and cost-effective, fostering growth in this arena. While critics worry about user experience and liquidity fragmentation, the evolution towards seamless interoperability aims to alleviate these concerns, allowing different L2s to coexist and cater to diverse use cases. Overall, we are just beginning a journey toward modular scaling in blockchain technology with enormous potential for numerous L2s to co-exist.

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