The beginning of 2024 is full of "bull coming" scenes. In addition to the Bitcoin and Ethereum ETFs that everyone is paying attention to recently, the upcoming Ethereum "Cancun Upgrade #Decun" is definitely not to be missed. I have compiled a list of investments and opportunities about L2 that I am paying attention to, and I will share them with you.
There are many projects in the L2 track. I will still share with you the projects that I have researched and held. If you have better targets to choose from, please be sure to comment and recommend them to me!
It’s been 24 years, who still complains about not having enough passwords? Let’s go!
About Cancun Upgrade
1/ Main issues with Ethereum 2.0
#Ethereum 2.0 is mainly designed to solve three major problems:
High energy consumption caused by mining
Speed performance issues
High gas fee problem
With Ethereum officially switching to PoS, the energy consumption problem has been solved. But the remaining two problems - low performance and high fees - remain unsolved. As more and more dApps are born, Ethereum's performance bottleneck is further highlighted.
It is imperative to expand the capacity of Ethereum, and the core of this round of Cancun upgrade is to solve the problem of Ethereum expansion.
2/ What has Cancun upgraded?
The Cancun upgrade is an important technical upgrade for Ethereum. Similar to the previous Shanghai upgrade, it is also named after the city where the Ethereum Developer Conference was held.
From a technical perspective, Ethereum expansion can be divided into two major routes: on-chain expansion and off-chain expansion. On-chain expansion refers to improving the performance of the Ethereum main network (L1) itself, while common off-chain expansion solutions include: Rullup of sidechain and Layer2 solutions
The core content of the Cancun upgrade is sharding and Rullup. After the Shanghai upgrade, Ethereum's current development focus is to promote Rollup-centered expansion. Therefore, in this upgrade, the proposal EIP-4844 that can promote the development of Rollup and reduce Gas Fee has become the core. The speed of Ethereum Layer2 is likely to increase by dozens of times, but the cost is lower.
Project opportunities brought by Cancun upgrade
1/ Projects involved in the Cancun upgrade
Rollups is an Ethereum Layer2 scaling solution. There are currently two main types of projects: Optimistic Rollups and Zero-Knowledge Rollups.
The Cancun upgrade will bring substantial benefits to the Ethereum network. After the upgrade is completed, it is expected to stimulate the explosion of Ethereum L1 itself and L2 ecological applications. Around New Year's Day, $ETH and related project tokens have seen very good growth. I have summarized the projects that I focus on for your reference.
The targets in the figure below are all my holdings, and there are also some targets in the fixed investment list. After all, the bull market is coming, and there is always one that will take off.
4/ Project investment opportunities
Ethereum will definitely be affected and continue to take off. In addition to $ETH, I think these projects are worth keeping an eye on and holding boldly.
L2 Faucet:
$ARB and $OP, let’s add zkSync which is always popular among the public
ARB Ecosystem
$GMX: The leader in decentralized derivatives
$RDNT: ARB-backed lending project
$MAGIC: An important GameFi project. After all, GameFi is also an important narrative in the next cycle.
OP Ecosystem
$VELO ( VELODROME )
$SNX: Synthetic assets + full-chain liquidity, the leading project of DeFi on OP
ZK Ecosystem
$IMX, $MINA, and $LRC are all projects that can be hyped and are valuable.
"Side Door" L2
$MATIC: It is a side chain with its own independent consensus, and is not considered L2. However, Polygon has several ZK Layer2 solutions, which is equivalent to shifting from the public chain market to embracing ETH L2. It has strong technical strength and market driving force.
$METIS: The odds are really high, and the mixed narrative is very interesting
There are too many projects to follow. If you have better investment targets, please share them with me. With the Cancun upgrade + ETF + bull market cycle, L2-related projects will definitely take off. Just go for it.
