Research Summary
The report provides a detailed analysis of the top 10 Layer-2 (L2) solutions by total value locked (TVL) in October 2023. It highlights the dominance of Arbitrum, Polygon, and Optimism, and the emergence of new players like Base, zkSync Era, and Mantle. The report also discusses the fluctuation in TVL across these solutions and the factors contributing to their growth.
Key Takeaways
Market Dominance of Top Three L2 Solutions
- Arbitrum’s Leadership: Arbitrum leads the L2 solutions market with a TVL of $1.79 billion in October 2023, capturing 41.2% of the top 10 L2 solution market share.
- Polygon’s Strong Position: Polygon holds the second position with a TVL of $0.78 billion in the same period.
- Optimism’s Competitive Stand: Optimism follows closely as the third largest L2 solution with a TVL of $0.64 billion.
Emergence of New L2 Solutions
- Base’s Rapid Growth: Base, a newcomer, has shown impressive growth, capturing 7.2% or $0.3 billion TVL in October 2023.
- zkSync Era’s Entry: zkSync Era, another new entrant, has secured 2.8% or $0.1 billion TVL in the same period.
- Mantle’s Market Entry: Mantle, the third newcomer, has captured 1.1% or $48.0 million TVL in October 2023.
TVL Fluctuations and Market Share
- Yearly Peak and Subsequent Decrease: The total TVL across the top 10 L2 solutions reached a yearly peak of $5.3 billion in May 2023, but decreased to $4.3 billion in October 2023.
- Market Share Distribution: The top three L2 solutions, ARB, POL, and OP, combined make up 73.8% of the total TVL of the top 10 L2 solutions.
- Newcomers’ Market Share: The three newcomers, Base, zkSync Era, and Mantle, account for 11.0% of the top 10 market share in October 2023.
Gnosis’s Growth
- Gnosis’s TVL Increase: Gnosis more than doubled its TVL, reaching $160.1 million in October 2023, due to supporting sDAI and asset tokenization.
Actionable Insights
- Monitor the Growth of Newcomers: The rapid growth of newcomers like Base, zkSync Era, and Mantle indicates a dynamic market. Stakeholders should closely monitor these players for potential collaborations or competitive strategies.
- Understand Factors Driving TVL: The report highlights the importance of supporting sDAI and asset tokenization in driving TVL, as seen with Gnosis. Stakeholders should investigate the potential of these factors in enhancing their offerings.
- Assess Market Share Distribution: With the top three L2 solutions holding 73.8% of the total TVL, stakeholders should assess the market share distribution to understand the competitive landscape and identify potential opportunities.
