Ethereum is secure and decentralized, but when the network gets busy, it becomes almost unusable for most people. Its revenue still comes from gas fees paid in $ETH.

Next, "Dino" Layer 1s (L1s) came along, promising fast and cheap transactions, but they usually traded off too much security. Most of them didn't last. Tron and Polygon are two of the few still actively building. Others mostly got popular because of incentives, and once those dried up, so did the momentum.

Then Layer 2s (L2s) arrived. They inherit Ethereum’s security, but most are run by a single Sequencer controlled by an institution. Their tokens don’t really do much for holders, and most of the revenue goes back to the operator, not to the $ETH stakers securing the settlement layer. That is why L2 tokens (and to some extent $ETH) continue to struggle with fundamental value accrual. L2s do offer the hope of running a decentralized sequencer and sharing protocol revenue once that feature is implemented.

Looking at recent revenue data, the L1/L2 economic differences are stark: Tron has a 30-day trailing revenue of approx $30M, while major L2s lag significantly, with Optimism $OPMainnet at$150K, Arbitrum $ARB at $1.6M, and the currently tokenless L2, Base, at $7.4M (source: defillama.com)

This gap exists because $TRX is actively used and required to pay fees in its ecosystem, creating a positive feedback loop between users, projects, and the protocol, which is largely missing in the case of $OP or $ARB.

Most L2s had a strong run early on, but some of that initial hype seems to be fading now. Fragmentation of liquidity and the reliance on infinite bridges are also contributing to their slower adoption.

As Warren Buffett said, "It's far better to buy a wonderful company at a fair price than a fair company at a wonderful price."

And that’s why you’re seeing new L1s popping up again: there’s a clear gap in how value and revenue get shared with investors and token holders, and these new chains see an opportunity to fill it by offering a direct claim on network profits

Ethereum is secure and decentralized, but when the network gets busy, it becomes almost unusable for most people. Its revenue still comes from gas fees paid in $ETH.

Next, "Dino" Layer 1s (L1s) came along, promising fast and cheap transactions, but they usually traded off too much security. Most of them didn't last. Tron and Polygon are two of the few still actively building. Others mostly got popular because of incentives, and once those dried up, so did the momentum.

Then Layer 2s (L2s) arrived. They inherit Ethereum’s security, but most are run by a single Sequencer controlled by an institution. Their tokens don’t really do much for holders, and most of the revenue goes back to the operator, not to the $ETH stakers securing the settlement layer. That is why L2 tokens (and to some extent $ETH) continue to struggle with fundamental value accrual. L2s do offer the hope of running a decentralized sequencer and sharing protocol revenue once that feature is implemented.

Looking at recent revenue data, the L1/L2 economic differences are stark: Tron has a 30-day trailing revenue of approx $30M, while major L2s lag significantly, with Optimism $OPMainnet at$150K, Arbitrum $ARB at $1.6M, and the currently tokenless L2, Base, at $7.4M (source: defillama.com)

This gap exists because $TRX is actively used and required to pay fees in its ecosystem, creating a positive feedback loop between users, projects, and the protocol, which is largely missing in the case of $OP or $ARB.

Most L2s had a strong run early on, but some of that initial hype seems to be fading now. Fragmentation of liquidity and the reliance on infinite bridges are also contributing to their slower adoption.

As Warren Buffett said, "It's far better to buy a wonderful company at a fair price than a fair company at a wonderful price."

And that’s why you’re seeing new L1s popping up again: there’s a clear gap in how value and revenue get shared with investors and token holders, and these new chains see an opportunity to fill it by offering a direct claim on network profits