L2 Blockchains’ TVL Have Grown, but L1s’ Still 10X Bigger: Report

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L2 Blockchains’ TVL Have Grown, but L1s’ Still 10X Bigger: Report
  • CoinGecko noted that Layer-1 blockchains maintain their TVL dominance over Layer-2 blockchains. 
  • The data tracker noted that the top ten L1s’ TVL of $36.5 billion is nearly ten times bigger than that of L2s.
  • Ethereum continues to be a TVL market leader, with a TVL worth around $23 billion as of October 2023.

With investors’ confidence in the crypto market gaining by the day, CoinGecko, in its latest report, said Layer-1 blockchains continue to edge Layer-2 blockchains in terms of total value locked (TVL). 

Indeed, the data tracker noted in its analysis that L1 blockchains continue to dominate the TVL market. In particular, the blockchains within this category are estimated to be 9.6 times larger than their L2 competitors. This is despite Layer-2 blockchains seeing a boom in their TVL this year.

Per the report, the total TVL in the top 10 L1 blockchains grew by 4.5% between the start of January and the end of October. Also, the report mentioned that the TVL hit a yearly peak of $45.3 billion but has since decreased to $36.5 billion as of October 2023. 

Furthermore, the report stated that Ethereum is the top L1 blockchain with the most TVL, with around $23 billion as of October 2023. The analysis mentioned that the blockchain, around April, recorded an annual peak of $31.5 billion following its Shapella/Shanghai Upgrade.

In total, Ethereum has 63.1% of the top 10 L1 blockchains TVL market share as of October 2023. Behind Ethereum is Tron, which sits as the second largest L1 in 2023 with a TVL of $7.9 billion. Furthermore, the report pointed at Solana as the fastest-growing L1 blockchain, following a 97.2% TVL boost this year. 

Meanwhile, the report stated that 6 out of 10 of the top 10 L1 blockchains now run on a Proof-of-Stake (PoS) consensus mechanism, which is considered more environmentally friendly than Proof-of-Work (PoW). According to the report, Bitcoin is the only blockchain in the top 10 that still runs on PoW. 

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