While Ethereum-based Layer 2 solutions have focused on network hyperscaling, Ethereum co-founder Vitalik Buterin believes that Layer 3 will serve a completely different purpose – to provide “tailor-made functionality.”
Buterin shared his thoughts in a Saturday post, providing three “visions” of what Layer 3 will be used for in the future.
The co-founder of Ethereum said that the third layer in the blockchain only makes sense if it provides features different from the layer 2 features that were used mainly to improve scaling with the zero-knowledge Rollup (zk) technology:
“Three-tier scaling architectures consisting of layering the same scaling scheme on top of itself generally don’t work well. Rollups on top of rollups where two levels of rollups use the same technology certainly don’t work.”
However, “a three-tier architecture, in which the second and third layers have different purposes, can work,” Buterin said.
One use case for layer 3 would be what Buterin describes as “custom functionality” – referring to privacy-based applications that will use zk proofs to send privacy-preserving transactions to layer 2.
Another use case could be “custom scaling” for specialized applications that don’t want to use the Ethereum Virtual Machine (EVM) to perform computations.
Buterin also said layer 3 could be used for “weak trust” scaling with zk-proof Validiums technology. Buterin said this could be useful for “enterprise blockchain” applications by using “a centralized server that runs a validator and hashes on the chain are regularly captured.”
But Buterin added that it is still unclear whether the Tier 3 structures will be more efficient than the current Tier 2 model when it comes to building custom applications on Ethereum.
Layer 2 and layer 3 network architecture. Source: StarkWar.
Related: Beginner’s Guide to Understanding the Layers of Blockchain Technology
“One of the possible arguments in favor of a three-tier model over a two-tier model is that the three-tier model allows an entire sub-ecosystem to exist within a single union, which makes it very cheap to perform cross-domain operations in that ecosystem. without having to go through the costly Layer 1,” Buterin said.
But Buterin said that because cross-chain transactions can easily and cheaply be done between two layer 2s that are tied to the same chain, building a layer 3 may not necessarily improve the efficiency of the network.
Buterin’s comments on the possible use cases for layer 3 have come as StarkWare’s recent recursive validity proofs seem to have put an end to Ethereum’s scalability issues.
Declan Fox, product manager at Ethereum software company ConsenSys, recently told that “with recursive folds and proofs, we could theoretically scale indefinitely.”
These recursive proofs have been well tested in production: StarkWare co-founder Eli-Ben Sasson recently told that his recursive proofs pooled up to 600,000 non-fungible tokens in a single transaction on Immutable X and that 60 million transactions could soon be on the cards “with more engineering.” and settings.