Ethereum Layer 2 scaling has entered a decisive phase. With over $40 billion in total value locked across rollup networks, the L2 ecosystem has moved from experimental to essential infrastructure. The competitive landscape in 2025 reveals clear architectural divergences, shifting fee economics, and an emerging battle for developer and user mindshare.

The Rollup Architecture Divide

The fundamental split in Ethereum Layer 2 design centers on how transactions are verified: optimistic rollups assume transactions are valid and use fraud proofs to catch errors, while ZK rollups generate cryptographic proofs that verify correctness mathematically.

Optimistic Rollups

Arbitrum and Optimism (the OP Stack) dominate the optimistic rollup category. Their advantage is EVM equivalence — existing Solidity code deploys without modification. The 7-day challenge period for withdrawals remains a UX friction point, though third-party bridges largely abstract this away.

Arbitrum One has consistently led in TVL and transaction count, driven by a strong DeFi ecosystem including GMX, Camelot, and Radiant. The Arbitrum Stylus upgrade introduced WASM support, allowing smart contracts written in Rust, C++, and other languages to run alongside Solidity.

The OP Stack, meanwhile, has become the default framework for launching new L2 chains. Base (Coinbase), Zora, Mode, and multiple other chains use the OP Stack, creating a network effect that strengthens Optimism’s “Superchain” thesis.

ZK Rollups

zkSync Era, StarkNet, Polygon zkEVM, and Scroll represent the ZK rollup frontier. These chains generate validity proofs that cryptographically guarantee correct execution, eliminating the need for challenge periods. Withdrawals to L1 are near-instant once proofs are verified.

The trade-off has historically been prover cost and EVM compatibility. Generating ZK proofs is computationally expensive, and achieving full EVM equivalence requires either circuit-level optimization or custom virtual machines. StarkNet takes the custom VM approach with Cairo, while zkSync and Scroll pursue EVM equivalence.

Fee Economics After EIP-4844

The Dencun upgrade’s EIP-4844 introduced blob transactions, dramatically reducing the cost of posting L2 data to Ethereum L1. The impact has been significant: average transaction fees on major L2s dropped 90-95% after the upgrade.

This fee reduction changes the competitive calculus. When L1 data costs were high, L2s competed on compression efficiency. With blob space available, competition has shifted to execution performance, developer experience, and ecosystem depth.

L2s now face a new economic challenge — generating sufficient revenue from the reduced per-transaction fees to sustain operations. Several chains have responded by introducing priority fee mechanisms and targeting high-value use cases (DeFi, gaming) that generate more transactions.

The Interoperability Challenge

With dozens of L2s operational, fragmented liquidity has become the primary UX problem. Users and assets are scattered across chains, each with its own bridge, wallet configuration, and gas token.

Several approaches aim to solve this:

  • Shared sequencing allows multiple L2s to share a transaction ordering layer, enabling atomic cross-chain transactions
  • Intent-based bridges like Across and Connext match user intents with solvers who fill orders across chains
  • Chain abstraction layers hide the multi-chain reality from users, routing transactions to the optimal chain automatically
  • Superchain/Hyperchain models from Optimism and zkSync create families of interoperable L2s with native bridging

Who’s Winning?

Measuring L2 success requires multiple metrics. By TVL, Arbitrum leads. By transaction count, Base has surged due to consumer application adoption. By developer activity, zkSync and StarkNet show strong growth in unique deployers.

The pattern emerging is specialization. General-purpose L2s (Arbitrum, Base) capture broad DeFi and consumer use cases. Application-specific L2s optimize for particular domains — gaming (Immutable X), social (Lens Chain), or enterprise (private rollups).

Key Takeaways

  • Optimistic rollups lead in TVL and adoption; ZK rollups offer stronger security guarantees with improving EVM compatibility
  • EIP-4844 reduced L2 fees by 90-95%, shifting competition from data costs to execution and ecosystem quality
  • Liquidity fragmentation across L2s is the primary UX challenge, with shared sequencing and chain abstraction as emerging solutions
  • The OP Stack’s modular approach is creating a network effect through the Superchain ecosystem
  • Specialization is emerging, with general-purpose and application-specific L2s serving different market segments

The Ethereum Layer 2 landscape in 2025 is defined by abundance rather than scarcity. The challenge is no longer whether rollups can scale Ethereum, but how the ecosystem navigates fragmentation, sustains economic models on lower fees, and delivers a user experience where the underlying chain complexity becomes invisible.