TL;DR
- Xai, an Ethereum layer-3 (L3) solution, reached a record of 101.72 transactions per second (TPS) on June 16.
- Despite the high TPS, the total value locked (TVL) in Xai is modest, at $1.33 million, compared to Arbitrum One and Base.
- Vitalik Buterin highlights the potential of L3 for customized functionalities and scalability improvements, though there are criticisms regarding its impact on the ETH ecosystem.
The Ethereum network is breaking records thanks to Xai, a layer-3 (L3) solution, which achieved a mark of 101.72 transactions per second (TPS) on June 16. This L3 has the capability to boost the scalability of the ETH network, significantly surpassing previous records within the ecosystem.
Developed by Offchain Labs, the creators of the Arbitrum One blockchain, Xai primarily focuses on gaming applications. Since its launch on June 12, the L3 has experienced meteoric growth in TPS, starting with a single daily transaction and reaching its current peak in less than a week. Its outstanding performance has set new standards for L2 and L3 solutions in Ethereum, demonstrating its potential to handle massive transaction volumes efficiently.
Despite its impressive performance in terms of TPS, the total value locked (TVL) in Xai remains relatively modest, at $1.33 million. This contrasts sharply with other solutions in the network like Arbitrum One and Base, which hold $17.78 billion and $7.54 billion in TVL, respectively. The disparity suggests that, although Xai has demonstrated its technical capability, it still has a way to go in terms of adoption and trust from users and investors.
Layer-3 solutions like Xai represent a significant advancement in blockchain technology infrastructure. While layer-1 (L1) solutions provide security and decentralization, and layer-2 (L2) solutions focus on enhancing scalability over L1, L3 solutions aim to further scale blockchain networks by anchoring them into L2 for greater security. This approach could offer exponential benefits in terms of scalability and efficiency.
Ethereum L3s Could Bring a New Level of Customization
Vitalik Buterin, co-founder of Ethereum, has previously discussed the potential of L3 technologies. In a blog post published in 2022, Buterin explained that L2s are primarily designed for scaling, while L3s are intended for customized functionalities, such as privacy. He believes that L3 solutions could take various forms, including specialized applications and rollups optimized for specific data formats. Additionally, he mentioned the possibility of using validiums, systems that use SNARKs for computation verification but rely on trusted third parties for data availability.
Despite the enthusiasm and potential, some experts have expressed concerns. Marc Boiron, CEO of Polygon Labs, has criticized the notion of L3, arguing that it could siphon value from the Ethereum ecosystem to the L2s they build upon.
Xai is a testament to the growing importance and potential of layer-3 solutions to improve Ethereum’s scalability. Although it is still early to fully assess its impact, the industry will closely monitor the development of these technologies and their influence on the future of decentralized applications and network scalability.
