Original text: Barry, Co-CEO of Interchain Labs
Compiled by: Yuliya, PANews
Recently, payment giant Stripe has officially entered the field and will collaborate with renowned crypto venture capital firm Paradigm to create an L1 blockchain named 'Tempo'. This is a 'high-performance, payment-focused blockchain' serving the clientele of fintech giants.
Stripe's entry is not an isolated case; it may be revealing the beginning of a huge trend—the quiet rise of enterprises building their own L1 blockchains. Why have large enterprises rekindled interest in building their own blockchains after years of silence in the enterprise blockchain space, and why prefer L1? The following is the original text of the article, compiled by PANews.
This is not a one-time case, but rather the beginning of a huge trend of enterprises building their own L1 blockchains. Many companies (including some Fortune 500 companies) are currently considering launching their own L1 blockchains.
Years ago, enterprise-grade blockchains faced failures and became a sensitive topic for a long time. So, why are mature enterprises starting to rebuild blockchains now? And why choose L1 blockchains?
The reasons for the return of enterprise blockchains are mainly twofold:
1. The maturity of stablecoins
The financial team currently in communication is no longer unfamiliar or fearful of stablecoins. Thanks to Circle's IPO and forthcoming regulatory policies, stablecoins are seen as a safe and powerful technology that can help enterprises reduce costs, streamline business processes, and earn more from cash reserves or customer deposits. Most large companies are building the infrastructure to hold and circulate stablecoins. Countries like the United States and Japan are actively promoting stablecoin regulations, and the overall environment is developing in a favorable direction.
2. Focus on payments, not traceability
In the previous enterprise blockchain boom, most application scenarios focused on traceability (i.e., tracking the origin and lifecycle of a cross-company process, such as supply chain raw material tracking or tracking the use of charitable funds). However, such scenarios can be fully implemented through databases; the only issue is trust.
Today, regardless of the industry, the primary focus of enterprises in communication is payments. Most B2B and B2C payment service providers and networks charge merchants and enterprises high fees, with settlements taking several days and real settlement risks existing. Once cross-border or foreign exchange is involved, these issues become even more pronounced. For multinational companies (especially platform companies like Airbnb), building a blockchain-based payment solution can save billions of dollars and provide a better experience for customers, employees, and gig workers.
As for why to choose to build L1 rather than L2 or smart contracts, there are three reasons:
1. L1 is mature and well-known to technical decision-makers
After more than a decade of development, L1 as a technology platform is well understood and validated. Ethereum, Bitcoin, Solana, Sui, Aptos—almost all blockchains that non-crypto industry people can name are L1 (Base may be an exception). The Cosmos technology alone supports over 200 chains, covering various fields and holding a total asset value of over $70 billion; the largest new project in the past year, Hyperliquid, further solidified this landscape. In addition, the most successful enterprise-grade blockchains, such as Canton, are also L1.
In contrast, while L2 is exciting, it remains in its early stages and is difficult to understand (imagine explaining the difference between 'Stage 1' and 'Stage 2 Rollup' to the CTO of a consumer goods market business or describing how a validation bridge works; the difficulty is evident). Decision-makers in mature enterprises are often reluctant to take risks on emerging platforms. Entering the crypto space itself is a significant risk, so the choice must be made in the way that is easiest for stakeholders to understand.
2. Reduce platform risk
Most companies are unwilling to bet on ETH, SOL, TIA, or other public chains, but rather wish to bet solely on themselves. Building L1 is the best way to achieve this goal. Large enterprises often use multiple cloud service providers to mitigate risks from AWS or Microsoft, while they perceive the risks of Ethereum or Solana to be much higher than those of these traditional partners.
3. Control and connectivity
An open and transparent L1 provides enterprises with the ability to interconnect with a broader crypto enterprise ecosystem while maintaining independent control over the platform. L2's interoperability with other chains (such as Solana) relies on third parties and is often limited by fraud/zero-knowledge proof windows and Ethereum's slow finality confirmation, resulting in settlement delays. L1 does not have this issue; settlements are instant and deterministic, ensuring consistency in interoperability. This feature, combined with the ability to create a corporate-owned 'walled garden' and implement necessary KYC/AML and application logic within it, will be highly attractive.