The Big Three: Arbitrum, Base, and Optimism Dominate Layer 2

ByL

Layer 2 has consolidated around three giants processing nearly 90% of all transactions. Meet the networks winning the scaling race.

Arbitrum: The DeFi Powerhouse

Launched in August 2021, Arbitrum has emerged as the undisputed leader in Layer 2. With $16.63 billion in TVL as of late 2025, it commands the largest share of decentralized finance activity.

What makes Arbitrum dominant:

  • Deepest liquidity pools for trading
  • Over 60% of Layer 2 market share for DeFi
  • Battle-tested security and reliability
  • Strong developer ecosystem

If you’re trading DeFi tokens or yield farming, chances are you’re using Arbitrum.

Dashboard screenshot showing Arbitrum One blockchain metrics with two rows of panels. The top row contains six white cards summarizing key statistics: Total Value Secured at 16.98B, Stablecoin Market Cap at 7.77B, DeFi TVL at 3.41B, RWA Market Cap at 847.97M, DEX Liquidity at 497.21M, and Bridge Last 30D Net Flow at -118.54M, each labeled “@entropy_advisors” with small time-stamp badges.
Key information about total assets on Arbitrum (Source: Arbitrum website)

Base: The Retail Champion

Coinbase’s Layer 2 network Base has exploded in growth, capturing over 60% of Layer 2 transactions in 2025. Its secret? Making crypto accessible to mainstream users.

Base’s advantages:

  • Seamless integration with Coinbase accounts
  • One-click fiat on-ramps
  • Lowest barrier to entry for new users
  • Strong focus on consumer apps and NFTs

Base’s “Onchain Summer” campaign brought 2.2 million new wallets to Layer 2—an 8x year-over-year increase.

Optimism: The Infrastructure Innovator

With $6 billion in TVL, Optimism pioneered the “Superchain” concept—a network of interconnected Layer 2s sharing security and liquidity.

Optimism’s unique approach:

  • Modular development framework (OP Stack)
  • Retroactive funding for ecosystem contributors
  • Focus on public goods and developer tools
  • Growing network of OP-based chains

The Bottom Line

ArbitrumBaseOptimism
CreatorOffhchain LabsCoinbaseOP Labs
TVL (USDbn)~17~12~2-3
ProsLargest DeFi liquidity, 60% L2 market share, battle-tested security, strong developer ecosystemEasy Coinbase integration, lowest entry barrier, 60% of L2 transactions, strong consumer focusOP Stack framework, Superchain interoperability, public goods funding, developer-friendly tools
ConsSlower than competitors, higher fees than BaseSmaller DeFi ecosystem than Arbitrum, centralized control by CoinbaseSmaller TVL than rivals, less retail adoption, complex governance model

For investors and users, the message is clear: stick with the big three. The Layer 2 wars have produced clear winners. These three networks aren’t just surviving—they’re thriving, with analysts predicting smaller L2s may become “zombie chains” by 2026.

One question that I have been pondering about the investments into Layer 2 is the monetisation opportunity associated with Layer 2. Now I am running through some hypothetical numbers here: estimate is projecting the aggregate TVL on Layer 2 can reasonably reach USD 1trillion by 2030e, and a reasonable monetisation rate (L2 operator revenue as a % of TVL) is 2-3% (through monetisation methods such as sequencer fees and MEV). In other words, that is a USD 1trillion * 2.5% = USD 25billion revenue opportunity (against USD 6-7billion annual revenue for Coinbase, and an estimated USD 10-50million for Offchain Labs and OP Labs). No wonder these players are spending billions to build out the Layer 2 infrastructure. [note: simply put sequencer fees are what users pay the Layer 2 “traffic controller” to put their transactions into blocks, and MEV is extra profit that comes from choosing a clever order for those transactions.]

In tomorrow’s final post, we’ll show you how to get started with Layer 2.

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