Every crypto bull run creates new winners.
In 2017, it was ICO platforms.
In 2021, it was smart contract chains and DeFi.
Now, heading into the next cycle, one debate keeps coming back:
Will Layer 1 blockchains dominate again, or will Layer 2 networks take over?
After watching multiple market cycles, building, trading, and researching across ecosystems, I’ve realized this isn’t a simple “one beats the other” story.
It’s about how crypto is maturing.
Understanding the Difference (Without the Tech Jargon)
Let’s keep this simple.
Layer 1 (L1) is the main blockchain itself.
Examples: Bitcoin, Ethereum, Solana, Avalanche, BNB Chain.
They handle:
Security
Consensus
Final settlement
Base transactions
Think of L1 as the foundation of a building.
Layer 2 (L2) is built on top of Layer 1.
Examples: Arbitrum, Optimism, Base, zkSync, Starknet.
They handle:
Faster transactions
Lower fees
Scaling
User experience
Think of L2 as extra floors and elevators added to the building.
Both are essential.
But in a bull run, attention and capital don’t spread evenly.
Why Layer 1s Always Shine First
In almost every cycle, Layer 1s move first.
Why?
Because they represent the “platform bet.”
When investors believe in a new ecosystem, they buy the base layer.
We’ve seen this before:
ETH in DeFi summer
SOL in NFT boom
AVAX in subnet hype
BNB during retail waves
Layer 1s benefit from:
Brand recognition
Strong narratives
Institutional interest
Long-term believers
They feel “safer” than small apps.
So when new money enters crypto, it usually flows to L1s first.
That won’t change.
The Scaling Problem That Changed Everything
But here’s the reality most people ignore:
Popular Layer 1s don’t scale well under pressure.
We’ve all experienced:
$50–$200 gas fees
Failed transactions
Network congestion
Slow confirmations
During bull markets, success becomes a problem.
Ethereum in 2021 proved this.
It was dominant, but unusable for many users.
That pain created opportunity.
And Layer 2s stepped in.
Why Layer 2s Are the Real Infrastructure Play
Layer 2s aren’t just “cheaper Ethereum.”
They are becoming full ecosystems.
Today, many users interact with crypto through L2s without even realizing it.
They offer:
Near-instant transactions
Low fees
Smooth UX
App-friendly environments
For builders, this matters more than hype.
Developers go where users are comfortable.
Users go where things work.
That feedback loop favors L2s.
In the next bull run, most new users won’t start on mainnets.
They’ll start on Layer 2.
Capital Flows Follow Usage
This is where things get interesting.
In past cycles, speculation led adoption.
Now, adoption is leading speculation.
Look at where:
DeFi volume
NFT activity
Gaming users
Social apps
AI agents
are moving.
More and more of it is happening on L2s.
And capital always follows activity.
When millions of users live on L2s, tokens tied to those networks gain real value.
Not just narrative value.
Why Layer 1s Are Still Untouchable
Does this mean L1s will lose?
No.
Strong Layer 1s are becoming “digital nations.”
They provide:
Ultimate security
Liquidity hubs
Settlement layers
Institutional gateways
Ethereum isn’t trying to process every transaction anymore.
It’s trying to be the world’s settlement layer.
Bitcoin isn’t competing with L2s.
It’s becoming digital gold plus programmable layers.
Top L1s are evolving.
Not dying.
The Rise of Modular Blockchains
Another big shift is modular architecture.
Instead of one chain doing everything, we now have:
Execution on L2s
Settlement on L1
Data availability layers
Specialized rollups
This design favors ecosystems, not single chains.
The winners won’t be isolated blockchains.
They’ll be networks of networks.
And L2s are central to this.
My Personal Take: The Next Bull Run Belongs to Ecosystems
I don’t think the next bull run will be “L1 season” or “L2 season.”
It will be ecosystem season.
The strongest ecosystems will win.
Those with:
Active developers
Loyal users
Strong tooling
Real use cases
Clear roadmaps
Ethereum + its L2s is the clearest example.
But others are building similar models.
The future is multi-layered.
And investors who understand this early will have an edge.
Where Retail Usually Gets It Wrong
Most retail traders make one mistake:
They chase headlines.
When L1s pump → they buy late.
When L2s pump → they FOMO.
When narratives change → they panic.
Instead of asking:
“What is trending?”
They should ask:
“Where is long-term activity growing?”
That answer is increasingly: Layer 2.
The Risk Nobody Talks About
Of course, L2s are not perfect.
Risks include:
Centralized sequencers
Governance control
Security dependencies
Token inflation
Not all L2s will survive.
Many will disappear.
Just like hundreds of L1s did.
So selection matters.
Quality matters.
The Likely Scenario
Here’s how I see it playing out:
1️⃣ Layer 1s pump first
2️⃣ Liquidity flows into ecosystems
3️⃣ Layer 2s explode in usage
4️⃣ Strong L2 tokens outperform
5️⃣ Weak chains fade
This pattern is already forming.
We’re just early.
Final Thoughts
Layer 1s built crypto.
Layer 2s are scaling it.
One provides trust.
The other provides usability.
You need both.
The next bull run won’t be won by choosing sides.
It will be won by understanding the stack.
By seeing how money, users, and builders move together.
In crypto, the future isn’t flat.
It’s layered.
And those who understand the layers early will be the ones standing strong when the hype fades.
#Square #squarecreator #Write2