DWF Ventures: Based rollups can alleviate the fragmentation issue of Layer 2, with major protocols making positive progress.

Odaily Planet Daily News DWF Ventures recently published an article on X, stating that current L2 solutions are largely centralized, with increasing fragmentation of liquidity, with over 74 L2 solutions already online and more to come. However, with the growth of Based rollups, these issues may be alleviated, as analyzed below: Ethereum Roadmap: A key goal of Ethereum is to reduce centralization concerns regarding MEV. Based rollups help achieve this by reducing reliance on centralized sequencers in L2, introducing distributed block construction and pre-confirmation for a better user experience. Based rollups: Sequencing is driven by the base L1, where L1 proposers replace L2 sequencers and can non-permissively include rollup blocks in L1 blocks. With more proposers joining, this enhances decentralization/activity, lowering the risk of chain interruptions/reviews. L2 generates significant income through transaction fees and MEV, with most income flowing back to teams due to the centralization of L2 sequencers. With Based rollups, L1 will redirect more value back to them. By sharing sequencing, rollups can gain additional value. Shared sequencing infrastructure: Espresso Systems is building a market allowing rollups to sell sequencing rights. This enables multiple proposers to participate in a single block, with rollups earning more sequencing income as proposers must bid higher than the reserve price to be selected as sequencers. Other protocols focusing on this area include: Astria, Rádius, NodeKit. Infrastructure application chain framework: Spire is establishing a framework for developers to create their own based application chains. Application chains can leverage L1 liquidity and can be combined with other application chains. Thus, users can enjoy a seamless bridgeless experience in the ecosystem. Use case of cross-chain composability: Coinbase is building its own based rollup "KeySpace" to enable smart wallets to cross chains via a single address. Taiko Gwyneth is a based rollup aimed at achieving synchronous composability between L1 <> L2/L2 <> L2, enabling more arbitrage and MEV opportunities, driving more value back to the base layer. Use case of improved user experience and earnings: Puffer Finance is building a based rollup called UniFi. Users can experience faster transactions (through pre-confirmation) and earn additional income from rollup fees. They can also access liquidity from other based application chains without dispersion. Overall, while the infrastructure of Based rollups may take time to mature, some major protocols have made positive progress. As more application chains are deployed as based rollups, the ecosystem will rapidly develop with strong network effects.