Degen Chain, a layer-3 blockchain on Base network, has gained attention due to its high transaction volumes reaching $100 million in 24 hours, with over 272,000 unique transactions, 7,500 contracts, and 2,300 tokens created. While some tokens are linked to scams, the chain enables experiments like tipping, community rewards, and gaming, with tokens like DSWAP and DEE holding significant valuations. The debate sparked by Polygon CEO Marc Boiron's criticism of unnecessary layer-3 networks highlights the ongoing discussion on the role of L3s in Ethereum scalability, with Vitalik Buterin seeing them as complementary rather than competing with L2s.
Degen Chain's Explosive Growth Amidst Concerns Over Rug Pulls
London, March 15, 2023 – Degen Chain, a layer-3 blockchain operating on the Base network, has experienced a meteoric rise in popularity, attracting substantial interest from investors and traders due to its high transaction volumes. In just four days since its launch, the network has processed over 272,000 unique transactions, created more than 7,500 contracts, and spawned over 2,300 tokens. However, concerns have emerged regarding the speculative nature of many tokens on the platform, with some linked to rug pulls or scams.
Degen Chain's exponential growth is attributed to its affiliation with the DEGEN token and its utilization of layer-2 protocols for enhanced transaction speed and application specificity. As a layer-3 blockchain, Degen Chain overlays layer-2 networks, enabling efficient task execution for applications such as payments, gaming, and other specialized functionalities. The DEGEN token functions as the primary gas token for transaction fees within the chain, facilitating various experiments such as tipping, community rewards, and gaming. Notable tokens on the network include Degen Swap (DSWAP) and Degen Easter Eggs (DEE), with DSWAP exceeding $14 million in valuation and DEE valued at $3.5 million.
Despite Degen Chain's rapid user adoption and increasing transaction volumes, critics have raised concerns about the necessity of layer-3 networks for Ethereum scaling. Polygon CEO Marc Boiron opined that layer-3 solutions primarily shift value away from Ethereum onto the underlying layer-2 networks they are built upon, questioning their essential role in scaling the Ethereum ecosystem.
However, proponents of layer-3 networks highlight their advantages, including cost-effective bridging from layer-2 networks, efficient on-chain proofing, customizable gas tokens, and specialized state transition functions that complement layer-2 offerings. The debate over the role of layer-3 networks in Ethereum scaling has sparked controversy within the blockchain community, with some aligning with Boiron's perspective while others, such as Ethereum co-founder Vitalik Buterin, recognize their potential to complement layer-2 solutions with unique functionalities.
As the debate continues, the long-term impact of layer-3 networks like Degen Chain on blockchain scalability and application development remains to be determined. The evolving landscape of layer-3 technology will be closely monitored by the blockchain community in the coming months and years.
