The Ethereum Limitation and The Composable Solution

The Ethereum Limitation

While the Ethereum protocol’s revolutionary smart contract functionality is what makes DeFi possible, the ETH transaction speed for DApps is notoriously slow, and it stands in the way of further DeFi development and mass adoption. Just as a point of reference, Ethereum’s transaction throughput is about 1,500 times slower than that of Visa and about 250,000 times slower than Alipay’s transaction throughput.
Several blockchain scaling solutions have been proposed to solve this scalability problem, including State Channels, Sharding, Plasma, OVM, and ZKRollups. These scaling solutions can be categorized as Layer 2 scaling solutions.
Layer 2 solutions sit on top of Layer 1 (the Ethereum mainnet in this case). Layer 2 solutions offer enhanced performance and scalability. As the blockchain ecosystem continues to evolve, Layer 1 (mainnet) will ultimately become the ‘trust layer’, while layer 2 begins to function as the ‘transaction layer’.
This will decrease the required computing power for transactions, as most transactions will be offloaded and processed outside the mainnet Layer 1 chain, eliminating much of Ethereum’s scalability issues.

The Composable Solution

Composable Finance is actively working to architect a solution to seamless cross-layer 2 interoperability. Composable has identified particular pain points holding back this cohesion, and is in the process of launching a suite of tools that alleviate these limitations. The end goal is to enable all of the existing Ethereum layer 2 solutions and the dApps using them to communicate with each other. This will allow users of these different platforms to perform near-instantaneous asset swaps, with vastly decreased costs when compared to present options. Additional benefits of Layer 2 unification include the ability to combat liquidity fragmentation between different L2s, and the opportunity for new functionalities across multiple L2s to be created.
Last modified 3mo ago