Avalanche DeFi Head: In the L2 era, what is the role of L1?
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Avalanche DeFi Head: In the L2 era, what is the role of L1?
The C-Chain is Avalanche's hub for liquidity. As subnets grow, all native assets on the C-Chain and exchange integrations will be leveraged through Avalanche Warp Messaging.
Navigating Web3 tides with focused insightsWritten by: Ignas | DeFi Research
Compiled by: TechFlow
Crypto researcher Ignas interviewed Luigi D'Onorio DeMeo, Head of DeFi/DevRel at Avalanche, to share his views on the role of L1s in the era of L2s, as well as our exploration of Avalanche's ultimate vision.
Here are his insights:
Both solutions promise to scale Ethereum with faster transactions and lower fees—functions originally meant for L1s. So what role do alternative L1s play now?
Will they disappear, evolve, or continue offering unique capabilities?
Luigi disagrees that Ethereum has already won the L1 "war." He warns that concentrating all activity on Ethereum creates centralization risks. He advocates for multiple L1s to provide choice, greater fault tolerance, and to foster competition and innovation at the L1 layer.
Interestingly, this contrasts directly with the view shared by Sanket, Polygon’s Head of Growth, during our AMA—he believes Ethereum has already won the L1 war.
Why does Avalanche have a three-chain architecture plus subnets? Luigi explains:
• The C-Chain is EVM-compatible and optimized for smart contracts with fast finality;
• The P-Chain is where validators coordinate;
• The X-Chain is a UTXO-based chain designed for asset transfers.
The vision for Avalanche subnets: “Subnets enable anyone to build their own blockchain. They can be customized in terms of validator permissions, virtual machines, and more. Many projects will want their own chains—such as TSM, Dexalot, dYdX, and others.”
Why build on a subnet instead of building on an L2 or L3?
“L2s and L3s often lack composability. With subnets, there’s no reason you couldn’t deploy an L2 as a subnet, have validators run sequencers, and use Avalanche Warp Messaging to communicate across subnets.”
The future of the Avalanche C-Chain: “The C-Chain is Avalanche’s liquidity hub. As subnets grow, all native assets on the C-Chain, exchange integrations, and more will be leveraged via Avalanche Warp Messaging.”
“As subnets expand, the C-Chain will thrive.”
Luigi introduced Ava Labs’ AvaCloud: “AvaCloud simplifies no-code Web3 blockchain deployment, enabling faster, cheaper, and lower-risk market entry. We’re continuously striving toward a world where deploying application-specific chains is as simple as possible.”
On the Avalanche blockchain ecosystem: “The value proposition of the Avalanche C-Chain differs from other systems. The primary network itself is a ‘special subnet.’ The C-Chain enables smart contract deployment with fast finality.”
Luigi spoke about Avalanche’s ultimate goal: “Our aim is to provide infrastructure that allows anyone to seamlessly build their own blockchain. We already have subnets deployed by numerous enterprise and institutional clients such as SK Planet, TSM, Bowlero, Gunzilla, and more.”
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Ignas | DeFi Research
