As Ethereum’s price pumps, everyone is wondering
where that capital will rotate to next. And the answer could be Ethereum’s own layer 2 ecosystem.
And most layer 2 tokens are still significantly down from their all-time highs. And this means
they have even more upside potential. Even more. And that’s why today we’re going to tell you
everything you need to know about Ethereum’s largest layer 2os, including how to access them,
where to find projects within their ecosystem, and how high their native tokens could go. My name
is Nick, and this is a vid you don’t want to miss. should be considered as financial or investment
advice. This video is purely for your education and entertainment intended to inform you about
five of Ethereum’s leading layer 2. Also, do note that some team members at Coin Bureau do
hold some of the tokens we will be covering today, but we promise to be as objective as always in
our analysis. So, if you ready to get into it, As most of you will no doubt know, Ethereum’s
biggest weakness is that it’s slow and expensive. Now, to remedy this, separate blockchains
called layer 2s or L2s are built as second layers on top of Ethereum, which is the layer
1. These L2s inherit Ethereum security while making the network faster and cheaper to use. The
reason why L2s are necessary is because Ethereum was designed to be secure and decentralized. The
trade-off though is that scalability takes a bit of a hit. Achieving all three of these features,
security, decentralization, and scalability, is a theoretically impossible challenge. Often
referred to as the quote blockchain trillemma, a term actually coined by Ethereum’s creator
Viptelic Buterine himself. L2 rollup solutions aim to address the scalability aspect of Ethereum’s
trilmma. Rollup solutions will literally roll up transactions into a bundle, process them
offchain, and then send that data back to Ethereum as a single transaction. And this allows
for faster Ethereum transactions at a fraction of the cost. Now, you should know that there are
several types of rollup solutions, each with their own pros and cons. The most used variants are
optimistic roll-ups and zero knowledge roll-ups. Optimistic roll-ups are optimistic because they
assume off-chain transactions are legit unless proven otherwise. Validators get a one-week
challenge period to check the data and then can submit fraud proofs if they spot anything
dodgy. Conversely, zero knowledge rollups or ZK rollups focus on privacy by using complex
cryptography to verify transactions without exposing sensitive information. Unlike optimistic
roll-ups, they don’t assume validity. Instead, they submit validity proofs to smart contracts
to prove transactions are legit. ZK roll-ups are usually faster than optimistic roll-ups since
there’s no one challenge period, which has helped their adoption. The trade-off is that generating
ZK proofs takes a ton of computing power. Creating other hurdles that are frankly outside the scope
of this video. Now, before we go any further, now that you understand what L2s are, uh let’s
take a look at one of the largest ones by Total Value Locked or TVL. In first place is Arbitum,
an optimistic rollup created by Offchain Labs in 2019. Its mainet went live in September 2021
and the ARB governance token was launched in March 2023. Arbitum is essentially an ecosystem of
scaling solutions that let developers build DAPs and roll up chains. It has four main components
starting with Arbitum 1, its flagship optimistic rollup. Arbitum 1 supports Ethereum smart
contracts and works with all of Ethereum’s developer tools. The second component is arbitum
nitro which is a tech stack for developers to use to build orbit chains which are technically layer
3es but uh let’s not go there. The third component is arbitrum stylus which allows developers to
build EVM compatible smart contracts using coding languages like rust C and C++ rather than just
solidity which is of course the coding language used for Ethereum’s smart contracts. And the
fourth is Arbitum Nova, which is itself an orbit chain. Arbitum Nova is faster and cheaper
than Arbitum 1, making it better for things like blockchain gaming and social media, albeit with
some centralization trade-offs. And these features have made Arbitum the top Ethereum layer 2 by TVL.
And it seems to be also emerging as a top layer 2 for Gamefi. And that’s because building blockchain
games is much easier since devs can code without learning solidity thanks to arbitum stylus. And
this lets devs build immersive games with cool features with play to earn with instant payouts
and ownable NFTts that work across different games. And most importantly, Arbitum Nova’s high
throughput and low costs keep those games running smoothly. Accessing Arbitum chains, including
Nova, is pretty easy. Uh just go to arbitrum.io and click bridge and explore. There you’ll see two
buttons bridge and portal. Bridge brings you to an interface that lets you transfer funds to arbitum.
And you’ll also need to add the arbitum network to a wallet like MetaMask, but the bridge does this
automatically, so no manual setup is required. Clicking portal takes you to the dashboard where
arbitum says there are over 1,000 apps built on its network. And what’s great is that you can sort
these by categories like DeFi, AI, Deepen, gaming, NFTts, and many more. Exploring these projects is
a great way to find promising tokens with serious upside potential. But what about Arbitrum’s own
ARB token? Well, even with the most recent altcoin rally, ARB is still about 80% below its all-time
high of $240, at least at the time of shooting. As such, returning to that level roughly translates
to a 5x gain from today’s prices. However, we believe that ARB could be significantly
undervalued. As more investors move further down the risk curve, many will be drawn to
Arbitum since it’s currently Ethereum’s largest layer 2. As such, we reckon a conservative
estimate for ARB would be somewhere around $4, roughly eight times up from today’s prices.
Okay. The second largest L2 by TVL is BAS, another optimistic rollup chain. A base was launched
by the Coinbase exchange in August 2023. Unlike other L2s in today’s video though, BAS doesn’t
have its own native token, and we’ll come back to that in a bit. Since launch, Bass has become
one of the most popular Ethereum blockchains, and that’s because it’s more efficient than many
other L2s, even outperforming Arbitum 1 by some metrics. But obviously, what’s really driven
adoption is its integration with Coinbase. Now, it’s important to note that Coinbase recently
began transitioning its wallet app into its base app, which is still in development, but should be
available in most countries. And if you already have the wallet, then don’t worry. It still works
as usual. But as the base app, it’s becoming an all-in-one platform for trading, posting, chatting
with friends, and even sending money globally for free. Since the Base L2 is such a major player
in the Ethereum ecosystem, it supports hundreds, if not thousands of projects. So, how do you spot
the ones with potential? Well, one way is to head on over to Coin Market Cap and then click on the
categories and sort the list alphabetically and scroll down to base ecosystem. From there,
you can filter these options by different narratives. And if you watched our recent video
on how to find 100x altcoins before they pump, you’ll know that some of the hottest narratives
on base include memecoins, tokenized RWA, and AI agents, among others. And you can learn
more about how to find these 100x altcoins before they pump by watching our video on that
right over here. Now, as we mentioned earlier, there is currently no native base token. And
what’s more is that Coinbase CEO Brian Armstrong and Bass founder Jesse Pollock have repeatedly
insisted that there isn’t going to be one. The most recent example of this was in April this
year after someone tokenized a Coinbase tweet and uh well, let’s just say it didn’t perform
so well. Soon after, Coinbase responded by stating that this wasn’t an official token and
there are no plans to create one either. We were previously more skeptical and thought that
a native token might still be on the cards, but now uh we think if it were going to happen, it
probably would already have happened. Launching a major token midbull market isn’t really the best
strategy since prices would almost definitely crash soon afterwards. For what it’s worth though,
Coinbase stock seems to have been benefiting from base the L2 itself. Okay, the third largest
layer 2 by TVL is the OP mainet, also known as Optimism. As the former name would suggest,
the OP mainet uses optimistic rollup technology. Optimism began as the plasma group back in January
2019 before rebranding a year later. Optimism’s mainet launched in December 2021. And what makes
OP mainet unique is its super chain which aims to unite the fragmented L2 space into one big
interoperable ecosystem. And you can easily track its chains and projects at superchain.eco. We’ll
drop a link in the description for you to come back and check it later. You can access OP mainet
through a compatible web 3 wallet like MetaMask, Coinbase wallet or trust wallet by first adding
the optimism network. If you’re using MetaMask, the OP mainet will already be available for you
to add within the app. If this isn’t an option for you, though, you’ll need to add the network
yourself. An easy way to do this is by visiting chainlist.org, which we’ll also leave a link to
for you guys in the description. Simply search for opainet, connect your wallet, and the chain
will be added automatically. Then to bridge funds, opainet suggests two options, bridge.gg GG
and Superbridge both will do the same thing, but we like the Super Bridg’s super simplistic
UI, so we’ve gone for that right now. Simply connect your wallet, enter the amount of ETH you
want to bridge to OP mainet, and then you’ll see the range of options. Using the native bridge
has no extra fees, but takes about 3 minutes, which isn’t too bad. Alternatively, you can select
much faster options that charge a small fee, like the Across protocol. When we tried these
options cut the wait time to 8 seconds for just a fraction of a scent. Once that’s set up, you’ll
probably want to start looking for upandcoming projects within OP mainet’s ecosystem. To do
this, head to the superchain.co website that we mentioned a moment ago. The chains and projects
button will help reveal some potential candidates. The chains tab lists quite a few blockchains, but
projects offers a much wider variety. And what’s great is that the projects tab has an in-built
filter, so you can select specific categories, aka different niches. For example, selecting
social narrows the list to 21 different projects, at least at the time of shooting. But what
about OP mainet’s own native OP token? Well, at the time of shooting, OP is still down 85%
from its previous all-time high of $4.85. And this means that rallying back to this level would
translate to a more than 6x gain from today’s prices. Now, we reckon that OP could actually
rally much further than this, and a conservative estimate would be around $8.50, so about 10x
from here. Now, the fourth largest Ethereum layer 2 by TVL is Uni Chain, a relative newcomer
from Uniswap Labs, which launched Uniswap, the leading Ethereum DEX, way back in 2018. UniS
swap’s native Uni token was launched in September 2020. But Uni Chain’s mainet only went live this
February. If you check out Uni Chain’s website, you’ll see it describes itself as quote the home
for DeFi. From the site, you can also access Uni Chain by clicking the bridge to Uni Chain button.
This will open up the Uniswap Dex with Uni Chain ETH already pre-selected as the asset. To bridge
your ETH over to Uniswap, connect any compatible Web3 wallet. We actually think Uniswap’s wallet
app is actually pretty good and even has a few handy features like custom usernames and keyboard
shortcuts to name but a few. Once that’s set up, you can easily bridge funds to Uni Chain by
swapping your regular ETH for Uni Chain ETH. To discover promising projects on Uni Chain, head
back to the website and scroll down to the start exploring section. You’ll see that it has quote
more than 100 apps and infrastructure building on Uni Chain with a button right below labeled
explore apps and integrations. Go ahead and click it. You should see a long list of every project in
the Uni Chain ecosystem. At the time of shooting, there were over 179 projects to explore. The good
news is that there’s a handy filter that lets you narrow your search by specific DY use cases. For
example, if you pick lending, the list shrinks down to just four projects. Much easier, right?
Now, what about Uni, the native token for both Uni Chain and UniS swap? Well, as we record this,
Uni is around 75% down from its all-time high of almost $45. And this means that returning to
that level would translate to a roughly 4x gain from here. Again, though, we believe that Uni
can surpass this target. As Ethereum continues to gain traction, more and more investors will
begin exploring DeFi and ERC20 tokens, both of which channel capital into unis swap. And this
could significantly drive UNI’s price up. And we reckon a conservative estimate would be for around
$80 for the UNI token and 8x from today’s prices. Now, the fifth largest Ethereum layer 2 by TVL
is ZK Sync, which is the only one in today’s list that doesn’t use optimistic roll-ups as a scaling
solution. Instead, as the name would suggest, it uses zero knowledge proofs, which as
you’ll recall from earlier in the video, can process transactions based on a portion of
the transaction data, making transactions faster and cheaper. In any case, ZKSync was originally
founded by Mattera Labs in 2018. In late 2019, Matala Labs revealed its plans for ZKYNC, and
the first version of it launched on mainet in June 2020. The current version, version 2.0, also
known as ZK Sync ERA, was launched in March 2023. The platform’s native ZK token was then launched
in June 2024. ZKSync is a major player in the tokenized RWA niche, second only to Ethereum. At
the time of shooting, Ethereum commands about 55% of the RWA market share, while ZK Sync holds
around 18% excluding stable coins. And what’s crazy is that ZKSync’s dominance far exceeds other
competitors like Aptos, Salana, and Stella. All of which have a market share of 4% or less. As you
will have guessed already, you can access ZKYNC by connecting any compatible web 3 wallet and then
adding the network to your wallet. If you’re using MetaMask, you should see that ZKYNC is already
available as a network you can add within the app. Alternatively, you can easily do this yourself
by visiting the chainlist.org website. Just type in zksync and you should see the mainet popup.
Connect your wallet and the ZKSync network will be added automatically. You can then bridge
your funds by visiting portal.zksync.io. We should of course point out though that this
bridge is currently in beta at the time of shooting, but for what it’s worth, we didn’t
experience any issues. Connect your wallet, type in how much ETH you want to bridge to ZKYNC,
and then click continue. You can find promising projects within the ZKYNC ecosystem by checking
out ZKSYNC’s official website. That’s because ZKYNC also has a similar concept to OP mainet’s
super chain. Now ZKYNC calls this the elastic network which consists of 19 different blockchains
all powered by ZKYNC technology. Of course, you can go through each of these 19 chains to
find a narrative that could do well. But given ZK Sync’s overwhelming market share of the RWA
niche, it could be a good idea to narrow the list down to projects that also support RWAS.
Not financial advice, of course. In any case, there is just one final question remaining.
What about ZK Sync’s native ZK token? Well, at the time of shooting, ZK is around 80%
down from its all-time high of 32. Reaching this level again would then be a gain of about
roughly five times from today’s prices. But, as you’ll probably know, the RWA niche is one with
serious potential. So, it won’t be surprising to hear that we think this target is easy to beat.
From our perspective, a conservative estimate would be somewhere around 50 cents or higher,
which would be around 10x from today’s prices. And that’s our rundown of the largest Ethereum layer
2OS. Of course, Ethereum’s L2 universe extends far
