Ethereum's Layer 2 Unites: Based and Native Rollups

Ethereum developers and layer 2 leaders are rallying behind a new approach to scaling the network, focusing on "based" and "native" rollups. This shift aims to enhance security and reduce fragmentation, making Ethereum more unified.

Jesse Pollak, head of Ethereum layer 2 Base, and Ben Jones, director of the Optimism Foundation, have expressed their support for this initiative. They believe that based rollups, proposed by Ethereum core developer Justin Drake, can improve collaboration between Ethereum's base layer and layer 2 networks. This approach returns the block-building process to the base layer, increasing decentralization and security.

Ethereum layer 2 networks like Arbitrum, Optimism, and Base have been using high-speed, centralized sequencers to process transactions, which has led to significant fees but also caused network fragmentation. By implementing based rollups, these networks can improve their connection to the Ethereum base layer and increase security guarantees.

Native rollups, on the other hand, focus on enhancing how transactions are executed on the base layer, making the network more composable. However, this transition may result in a significant portion of revenue obtained through Maximum Extractable Value (MEV) being forfeited. Arbitrum and Base have earned substantial sums from their centralized sequencers—$210 million and $96.2 million, respectively.

Despite the potential revenue loss, based or native rollups could bring more revenue back to Ethereum's base layer and potentially have a positive impact on Ether's (ETH) price. However, this transition would mean that transactions are confirmed in 12 seconds instead of around 1 second on many Ethereum layer 2s.

Several Ethereum layer 2 executives are also in favor of implementing "FABRIC," an infrastructure that would support based rollups. Ethereum layer 2 Taiko's CEO Daniel Wang has expressed his firm's willingness to adopt the FABRIC standard to address Ethereum's interoperability problems. Wang's Taiko was the first layer 2 to implement based rollups on Ethereum.

This strategic move by Ethereum's layer 2 networks signals a commitment to decentralization and improved security. While there may be short-term revenue losses, the long-term benefits for both developers and users could be significant. Enhanced composability and interoperability will likely make Ethereum a more robust