Vitalik Buterin Dispels Layer 3 Hype: ‘Not a Magic Scaling Fix’

• Ethereum co-founder Vitalik Buterin has joined the Layer 3 debate.
• The Ethereum co-founder suggests that his view on Layer 3 chains has not changed over the past year and a half.
• Buterin contends that these chains make no sense as scaling solutions but may serve other purposes.

Over the weekend, Polygon Labs CEO Marc Boiron ignited debates over the usefulness of Layer 3 chains by asserting that they “only exist to take value away from Ethereum .” Amid the ongoing discussion, Ethereum co-founder Vitalik Buterin has chimed in. Rehashing a blog post from September 2022 , Buterin suggests that his view of Ethereum Layer 3 chains has not changed since.

Buterin: Layer 3s Make No Sense as Scaling Solutions

In an X post on Tuesday, April 2, Buterin surmised that Ethereum Layer 3 solutions “don’t magically improve throughput,” as most people might be tempted to think. He also added that suggested cost savings on deposits and withdrawals could be achieved with Layer 2 chains .

The Ethereum co-founder expressed these views, citing thoughts shared in a September 2022 blog post. In the article, he explains that while it is tempting to think you can scale exponentially by just building one rollup on top of another, the reality is quite different. Why? Because of data availability constraints.

Data availability refers to the guarantee that all transaction information is available for every network participant to verify to maintain the network’s integrity. Rollups ensure data availability by periodically batching data to the mainnet or data availability solutions for validium chains. 

Due to limited and high-cost storage space on the mainnet, rollups typically employ data compression techniques to save costs. As Buterin highlighted, Layer 3 chains still face the data availability challenge and cannot improve the data compression process, which can only be performed once. 

"Data can be compressed once, but it cannot be compressed again - if it can, then there's generally a way to put the logic of the second compressor into the first, and get the same benefit by compressing once. Hence, 'rollups on top of rollups' are not something that can actually provide large gains in scalability."

So what, then, is the point of this emerging crop of rollups if they do not offer a scaling boost?

Specialized Functions?

In 2022, Buterin argued that the only way a Layer 3 chain made sense was to serve a special function and not for scaling. Examples highlighted by the Ethereum co-founder included serving as a data availability solution for a Layer 2 chain and serving as a privacy-focused layer.

Nonetheless, Buterin critiqued even these use cases, noting that time would tell if there are no better ways to achieve the desired outcomes.

On the Flipside 

• Degen, a recently launched Layer 3 chain on Coinbase -incubated Layer 2 Base , which has sparked a lot of intrigue around the Layer 3 narrative continues to see increased adoption.

Why This Matters

The Ethereum Layer 3 narrative has seen increased interest recently. Vitalik Buterin’s statements shed further light on the value proposition of these emerging rollups.

Read this for more on the Ethereum Layer 3 debate:

Layer 3s Weaken Ethereum’s Security: Polygon (MATIC) Labs CEO

Take a deep dive into the cause and impacts of the recent Polygon zkEVM outage:

Polygon zkEVM Outage and Fixes Unraveled in Full Post-Mortem