According to information in a research report by cryptocurrency exchange Coinbase, Layer-2 scaling solutions can reduce development and revenue on the Ethereum network:
“The future of Layer-2s may be a zero-sum game, because whatever L2 hosts most decentralized applications (DApps) could one day power the entire Ethereum ecosystem. Given this situation, it shows that L2s can eventually drive revenue away from Ethereum itself.”
Coinbase states that projects offering scaling solutions such as Polygon (MATIC), Optimism (OP) and Arbitrum in the past 12 months account for less than one percent of Ethereum's revenue:
“Over the last 12-month period, its tokens have reportedly generated total revenues of $9.971 billion, compared to just about $78 million in total revenue in Arbitrum, Polygon and Optimism.”
Cryptocurrency exchange Coinbase says that with the transition of ETH to a Proof of Stake (PoS) consensus mechanism taking place, scaling solutions will potentially cause a drop in staking returns, which could ultimately negatively impact the price of ETH:
“If more user activity moves to the L2s and these L2s need their own token projects to facilitate transactions, this could potentially reduce the stake returns for validators who will earn less than net transaction fees. If they stop staking on the platform, this will increase the circulating ETH liquid supply We can increase the size and possibly see it hurt ETH prices.”
However, according to research by Coinbase, it is also stated that scaling solutions can benefit ETH in the long run as it will increase network efficiency:
“Furthermore, the impact of L2s consuming ETH's revenues could be a short-term phenomenon. Observed in the long run, revenues depend on more activity in the overall cryptocurrency ecosystem and whether ETH is the dominant universal (or mainstream) blockchain. If L2s facilitate more transactions by making them more convenient, faster and easier, the initial revenue impact can be mitigated by increased activity that eventually happens in the network."