Ethereum News Today: Curve Proposal Calls for Halting Layer 2 Expansion to Focus on Mainnet and crvUSD

Curve Finance’s governance community is currently debating a proposal that calls for a pause in the protocol’s expansion into Ethereum Layer 2 networks, advocating instead for a refocusing of resources on the Ethereum mainnet and the development of its stablecoin, crvUSD. The proposal argues that the protocol’s Layer 2 deployments, which span 24 different chains, generate only about $1,500 in daily revenue, averaging less than $62 per network, a figure that does not justify the significant engineering and maintenance costs involved. In contrast, Curve’s mainnet pools bring in approximately $28,000 daily, making them a more profitable focus [1].

The proposal highlights that the Layer 2 networks demand a level of attention and development effort similar to the mainnet but offer minimal returns. This has led to calls for reallocating developer resources away from these Layer 2 chains and towards strengthening Curve’s core infrastructure and crvUSD. According to DeFiLlama data, over 90% of Curve’s total value locked (TVL) remains on Ethereum, further emphasizing the mainnet’s dominant role in the protocol’s ecosystem [1].

The DeFi community has responded with mixed views. Some analysts have drawn parallels with similar challenges faced by protocols like Aave, pointing to signs of saturation in the Layer 2 ecosystem. Analysts note that only a few Layer 2 networks, such as Polygon, Arbitrum, and Optimism, demonstrate significant user activity, limiting the potential for widespread adoption and profitability in multi-chain deployments [1].

However, Curve’s core development team has publicly distanced itself from the proposal, stating that it does not align with their current roadmap or strategic priorities. The team has clarified that it does not support the suggestion to halt Layer 2 expansion and intends to continue with its planned multi-chain strategy [1].

As the debate unfolds, stakeholders are urged to evaluate the cost-benefit ratio of Layer 2 expansions versus mainnet operations. Prioritizing high-yield areas like crvUSD and core infrastructure may enhance the protocol’s long-term sustainability. Meanwhile, continued monitoring of user adoption trends on Layer 2 networks could influence future multi-chain decisions [1].

Source: [1] [Curve Proposal Suggests Pausing Layer 2 Expansion to Focus on Ethereum Mainnet and crvUSD Development](https://en.coinotag.com/curve-proposal-suggests-pausing-layer-2-expansion-to-focus-on-ethereum-mainnet-and-crvusd-development/)