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L3s Explained Like I’m Five

David Tso

David Tso

L3s

L3s have seen explosive growth over the past few months, and many are starting to gain an appreciation for them.

Ethereum L1 + L2s + L3s will enable teams to bring more people onchain than ever before.

Here’s an overview of L3s and why they’re useful for those who are confused.

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What Is an L3

An L3 is an appchain that settles to an L2.

L3s have an isolated state environment and fee market, letting them scale further while being interoperable with the L2 economy.

They’re like onchain connected servers/databases that inherit L2s’ payments, identity, and trust infra.

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Why L3? (1/5)

L3s make it 100x cheaper and faster to onboard users/assets via L2.

If you launch a new L2, users need to go from a CEX to Ethereum L1 to your L2 (two L1 txs).

If you launch a new L3, users can go from a CEX to a major L2 with direct exchange support to your L3 (two L2 txs).

Why L3? (2/5)

L3s post updates/data to Ethereum L1 at much lower costs via L2.

For a major L2 with high tx volume, the fixed costs of posting to L1 get amortized away, but not for a new L2 with low tx volume.

For new L3s, they get to post to an L2 which incurs the costs of posting to L1.

Why L3? (3/5)

L3s give developers dedicated blockspace vs. L2.

On general-purpose L2s, global fee markets and limited blockspace mean that congestion will always lead to issues for the rest of the network.

On your own L3, you have dedicated blockspace, which is a proxy for fee isolation.

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Why L3? (4/5)

L3s give developers more configuration vs. L2.

There are many different ways to configure an L3 with alt-DA for cheap fees (e.g. Celestia, EigenDA, Avail), VMs for speed or security (e.g. SVM, MoveVM, parallel EVM), etc.

There’ll be tons of experimentation at L3.

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Why L3? (5/5)

L3s enable developers to leverage L2 distribution channels.

L3s can massively benefit from the underlying L2 by easily plugging into its existing users, liquidity, and assets.

This reduces your acquisition costs and gets you direct access and interoperability with an ecosystem.

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How to Deploy an L3

You can deploy an L3 today in just a few clicks with existing rollup frameworks and RaaS platforms.

Rollup frameworks: Arbitrum Orbit, OP Stack, Polygon CDK, ZK Stack

RaaS platforms: Conduit, Caldera, Gelato, AltLayer, Lumoz, Snapchain, Ankr, Zeeve

L3 Landscape

The L3 landscape is growing rapidly.

Arbitrum: XAI, Deri Chain, Meliora, Superposition, Syndr, Molten Network, ApeChain, Avive World, Fiefdom, Orb3Tech, PlayBlock, PMON Chain, Proof of Play Apex, Sanko, TreasureChain: Infinity Chains, AnimeChain, Hook Chain, Muster, Oursong, RARI Chain

Base: Degen Chain, Gold, Stack, Gotchichain, HAM Chain, PengChain, Onchain

Multichain: zkLink Nova

L3s Are Eating Web2 Compute

A few years ago many said L2s were pointless, and today many are saying the same about L3s.

L2s and L3s are just blockspace under the hood, and blockspace is the next generation of compute.

Similar to how we don’t know whether we’re running on AWS or GCP, soon we won’t know what blockspace we’re running on.

Arweave TX

Ynqrz8ahaCR6VgQuhfzntLIlHNYXmFY2g8cYV30Jurc

julieshi.eth
julieshi.eth
Commented 1 year ago

is there stack limitation to build L3 on top of Base? can i for example build FHE-enabled L3 on base?

David Tso (dave.base.eth) 🔵Farcaster
David Tso (dave.base.eth) 🔵
Commented 1 year ago

L3s can now be a part of @base and the @optimism Superchain! 🔵🔴✨ Here’s an overview of L3s and why they’re useful for those who are confused: https://paragraph.xyz/@cryptso/l3s

David Tso (dave.base.eth) 🔵Farcaster
David Tso (dave.base.eth) 🔵
Commented 1 year ago

L3s can now be a part of the @optimism Superchain! 🔴✨ Here’s an overview of L3s and why they’re useful for those who are confused: https://paragraph.xyz/@cryptso/l3s

David Tso (dave.base.eth) 🔵Farcaster
David Tso (dave.base.eth) 🔵
Commented 1 year ago

Just posted a new article on @paragraph! “L3s Explained Like I’m Five” Read, subscribe, and collect for free https://paragraph.xyz/@cryptso/l3s

David Tso (dave.base.eth) 🔵Farcaster
David Tso (dave.base.eth) 🔵
Commented 1 year ago

Just posted a new article on @paragraph! “L3s Explained Like I’m Five” Read, subscribe, and collect for free https://paragraph.xyz/@cryptso/l3s

David Tso (dave.base.eth) 🔵Farcaster
David Tso (dave.base.eth) 🔵
Commented 1 year ago

1/ L3s have seen explosive growth over the past few months, and many are starting to gain an appreciation for them Ethereum L1 + L2s + L3s will enable teams to bring more people onchain than ever before Here’s an overview of L3s and why they’re useful for those who are confused

David Tso (dave.base.eth) 🔵Farcaster
David Tso (dave.base.eth) 🔵
Commented 1 year ago

2/ An L3 is an appchain that settles to an L2 L3s have an isolated state environment and fee market, letting them scale further while being interoperable with the L2 economy They’re like onchain connected servers/databases that inherit L2s’ payments, identity, and trust infra

David Tso (dave.base.eth) 🔵Farcaster
David Tso (dave.base.eth) 🔵
Commented 1 year ago

3/ L3s make it 100x cheaper and faster to onboard users/assets via L2 If you launch a new L2, users need to go from a CEX to Ethereum L1 to your L2 (two L1 txs) If you launch a new L3, users can go from a CEX to a major L2 with direct exchange support to your L3 (two L2 txs)

David Tso (dave.base.eth) 🔵Farcaster
David Tso (dave.base.eth) 🔵
Commented 1 year ago

4/ L3s post updates/data to Ethereum L1 at much lower costs via L2 For a major L2 with high tx volume, the fixed costs of posting to L1 get amortized away, but not for a new L2 with low tx volume For new L3s, they get to post to an L2 which incurs the costs of posting to L1

L3s Explained Like I’m Five