Ethereum just entered a new phase and the entire market is trying to absorb what this pivot means. Vitalik’s latest comments made one thing extremely clear. The old rollup centric roadmap is no longer the future of Ethereum scaling. L1 upgrades have moved so fast that off chain scaling is losing its urgency and this changes the position of every L2 project in the ecosystem.
With blobs already cutting data costs nearly ninety percent and PeerDAS increasing data availability, Ethereum’s base layer is becoming strong enough to handle real throughput. Even the upcoming 2026 gas limit expansion towards forty to sixty million per block pushes L1 into a zone where congestion stops being a permanent problem. This directly affects L2 narratives because most L2s are still stuck between partial decentralization and multisig bridges that cannot match Ethereum’s security guarantees.
This pivot also flips ETH value capture. Stronger base layer activity boosts fees, staking rewards and burns which is good for long term ETH supply dynamics. But the problem is that L2s capture more than sixty percent of transaction volume without contributing meaningful value back to L1. A tighter coupling between L1 and L2 using native ZK EVMs is the direction Ethereum seems to be moving toward.
For L2 ecosystems this means survival mode. The only L2s that thrive from here are the ones that reach full proof systems without centralized councils. Projects like Optimism, Arbitrum and zkSync have a chance to evolve into real Ethereum extensions. Specialized app chains focused on privacy, AI workloads, gaming and ultra low latency can still survive because they offer experiences that Ethereum L1 cannot replicate directly.
Market data already shows consolidation. The top L2s by activity Base, Arbitrum, Optimism control more than eighty percent of usage while many smaller L2s are fading with usage dropping more than sixty percent. TVL is still holding around forty three billion but token performance continues to struggle because value capture is unclear.
For ETH this pivot sets up a long term bullish structure. Stronger L1 activity boosts MEV revenue, staking APR and burn pressure. The recent price region near twenty two hundred is becoming an important support area as the market prices in the new scaling clarity. Fear around L2 dilution decreases as Ethereum takes back more of the economic flow.
From here L2 tokens split into two categories. True Ethereum aligned L2s with real proofs and no multisig paths become stronger long term assets. Generic L2s with no unique moat face declining activity as Ethereum L1 competes on throughput.
The biggest takeaway is simple. Ethereum is repositioning itself as a high throughput L1 capable of handling large scale activity without relying entirely on external rollups. This shift will reshape the ranking of L2s and push the ecosystem toward high security native proof systems instead of fragmented L2 experiences.