Polygon Labs CEO warns: Emerging Degen Chain layer 3 network could threaten Ethereum’s security

Polygon’s CEO Marc Boiron has strongly stated that the company is not considering developing a layer 3 protocol due to possible risks to Ethereum’s security.

Boiron made this announcement against the backdrop of the early success of Degen Chain, a layer 3 network running on Base, a scaling solution powered by Coinbase.

"Layer 3 protocols enhance scalability by building on top of Layer 2 infrastructure, allowing developers to customize the blockchain for specific applications based on their needs."

Degen Chain

Degen Chain is a layer 3 network built for the DEGEN token using Arbitrum Orbit. The digital asset has quickly become the dominant community token among users of Farcaster, a rapidly expanding web3 social media platform.

Since its launch on March 28, the network has attracted widespread attention and trading activity within the crypto industry, with transaction volume increasing by an astonishing over 200% in the past week.

Data as of March 30 show that the network has facilitated more than $30 million in funding bridges and supported more than 3.5 million transactions.

Layer 3 Protocols TriggeredCommunity Debate

Degen Chain’s early success sparked debate in the crypto community, with community members holding mixed views on the network.

In a March 31 X (formerly Twitter) post, Boiron noted that layer 3 networks move value from Ethereum onto the layer 2 platforms that host them.

According to him, such a development trajectory is not consistent with Polygon’s commitment to Ethereum scaling, which the company has already addressed with its proof-of-stake (PoS) and zero-knowledge Ethereum Virtual Machine (zkEVM) chains.

Additionally, Boiron pointed out possible negative impacts of adopting Layer 3 networks, including their small performance gains and potential threats to Ethereum’s security. He said:

“If all L3 settles onto one L2, then basically no value will be captured by Ethereum, and therefore, the security of Ethereum will be compromised.”

He added:

“If Ethereum doesn’t earn fees, and has no prospect of earning fees, other than earning a little bit of fees from this one L2, then the value of ETH will fall, and when it’s clear to see it will continue to fall because there is no economy At this time, validators will no longer be willing to hold ETH and therefore be willing to protect the network.”

Meanwhile, blockchain expert Cygaar explained that layer 2 networks are not yet “mature” and have yet to inherit Ethereum’s level of security due to existing challenges such as network centralization, upgradeable bridging contracts and developing proof-of-proof systems.

Therefore, he believes that integrating Layer 3 networks on top of Layer 2 may exacerbate risks and compromise the security of these blockchain networks.

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