Ethereum's Layer 2 networks have witnessed a significant decrease in active users, falling from 58.4 million to around 30 million. According to NS3.AI, this decline comes as Ethereum's base layer has seen a doubling in active addresses. Vitalik Buterin, co-founder of Ethereum, suggests that Layer 2 networks need to redefine their value proposition beyond scaling, emphasizing privacy, specialized applications, or other innovative functionalities.
Despite low transaction fees on Layer 1 and plans to increase gas limits through 2026, market skepticism persists. This sentiment is reflected in notable price drops among major Layer 2 tokens.