August Layer 2 Landscape Recap

The on-chain activity on layer 2s (L2s) in August was generally lackluster, with the exception of Base and Starknet. Total value locked (TVL) fell significantly across the board, partly due to the recent pullback in the broader crypto markets. zkSync Era, which had been seeing relatively steady growth thus far, also saw a notable decline in TVL and on-chain usage this month. Unsurprisingly, Base continued to surge in growth metrics, both in daily transactions and unique users, though that trend appears to be tapering. 

The most notable on-chain activity in August was the substantial growth on Base, amidst the market downturn that had negatively impacted most other ecosystems. This is likely due to two reasons: one, Base has a strong reputation being affiliated with Coinbase, which grants them some access to Coinbase’s user base. Secondly, there is no governance token for Base, and although Base has repeatedly emphasized that it would not launch a token, it would still not prevent users from speculating. After all, the costs to create multiple accounts for a potential airdrop are relatively low on Base since transaction fees are low.