BASED ROLLUPS PITCHED AS FIX TO ETHEREUM INCENTIVES AMID L2 FEE DEBATE

The Ethereum ecosystem is a dynamic and constantly evolving landscape, grappling with the challenges of scalability and incentive alignment.Layer-2 (L2) scaling solutions have emerged as a crucial component in addressing these issues, offering faster and cheaper transactions. ETHUSD Ethereum Based Rollups pitched as fix to Ethereum incentives amid L2 fee debateHowever, the current L2 landscape has led to concerns about liquidity fragmentation and revenue leakage from the Ethereum base layer.Specifically, the traditional L2 model, with its own sequencers, often pulls value away from Ethereum's validators and stakers, sparking a debate about the economic sustainability of the ecosystem.Enter Based Rollups, a novel approach that proposes a fundamental shift in how L2s interact with Ethereum. 原文标题：Based Rollups pitched as fix to Ethereum incentives amid L2 fee debate. 原文作者：MARTIN YOUNG. 编译：Alvis，火星财经. Based Rollups可以为以太坊第 2 层网络从区块链基础层提取流动性和收入的问题提供解决方案。By leveraging layer-1 validators for transaction sequencing, Based Rollups aim to realign incentives, potentially boosting ETH demand and addressing concerns about deflationary pressure. Bitcoin ETFs See $28.6M Inflows After 8-Day Outflow Streak, but BlackRock Records Rare OutflowsThis solution has been hailed by some as a potential game-changer, offering a more cohesive and economically sound future for Ethereum's scaling efforts. Based Rollups, a layer-2 scaling solution that uses layer-1 validators for processing instead of their own sequencers, could directly impact the monetization of Ethereum by making a prettyThe discussion around Based Rollups is intensifying, with stakeholders carefully considering its impact on the network's long-term health and profitability. net chg. %chg. highThis article dives deep into the mechanics of Based Rollups, exploring their potential benefits, drawbacks, and the broader implications for the Ethereum ecosystem.

Understanding the Ethereum Layer-2 Scaling Challenge

Ethereum's mainnet, while secure and decentralized, has limitations in terms of transaction throughput and speed.This has led to high gas fees, especially during periods of network congestion, making it less accessible for everyday users. Based Rollups pitched as fix to Ethereum incentives amid L2 fee debate . Some commentators note that Based Rollups align incentives between Ethereum layer 2 and its base layer validators, which could result in deflationary issuance again. 442 Total views 2 Total shares Listen to articleLayer-2 solutions like Optimistic Rollups and ZK-Rollups have emerged to address these limitations.These L2s process transactions off-chain and then bundle them into batches that are posted to the Ethereum mainnet, significantly reducing the load on the base layer.

However, the current L2 model introduces new challenges.The primary concern revolves around the role of sequencers.These centralized or semi-centralized entities are responsible for ordering transactions and creating L2 blocks. cointelegraph.com: Some commentators note that Based Rollups align incentives between Ethereum layer 2 and its base layer validators, which could result in deflationary issuance again.They can extract significant value from this role through transaction fees and MEV (Maximal Extractable Value), which can be a substantial revenue stream.This revenue, however, doesn't directly benefit ETH stakers or validators on the Ethereum base layer, leading to a misalignment of incentives.

The central issues can be summarized as:

• Liquidity Fragmentation: Funds are dispersed across various L2 networks, making it less efficient to move assets between them.
• Revenue Leakage: L2 sequencers capture transaction fees and MEV, potentially diminishing the economic benefits for ETH stakers.
• Incentive Misalignment: The current system can incentivize the development of L2 solutions that prioritize their own profitability over the overall health of the Ethereum ecosystem.

What are Based Rollups and How Do They Work?

Based Rollups offer a novel approach to L2 scaling by eliminating the need for dedicated sequencers. Momentum Loses Its MoJo, and the Risk Trade MaInstead, they leverage the existing infrastructure of the Ethereum layer-1 (L1) validators to sequence transactions on the L2.This represents a fundamental shift in the L2 architecture, aiming to align incentives and improve the economic benefits for ETH stakers.

Here's a simplified explanation of how Based Rollups function:

1. Transaction Submission: Users submit transactions to the Based Rollup network.
2. L1 Proposer Inclusion: L1 block proposers (validators) include the rollup block in an L1 block.This is done in a permissionless manner, allowing any validator to participate.
3. Data Availability: Transaction data is posted on the Ethereum mainnet, ensuring data availability and security.
4. Settlement: The L2 state is updated based on the transactions included in the L1 blocks.

The key difference lies in the elimination of a separate L2 sequencer. Based Rollups pitched as fix to Ethereum incentives amid L2 fee debate - Cointelegraph Related Posts Ethereum Drops to Lowest Levels Against Bitcoin in 3.5 Years But - FX Empire - October 28th, 2025 [October 28th, 2025]The responsibility for ordering transactions and creating blocks falls directly on the Ethereum validators.This fundamentally changes the incentive structure, as the validators are already incentivized to secure the Ethereum network.

Decentralized Block Building and Pre-Confirmations

Based Rollups aim to enhance the user experience (UX) by implementing decentralized block building and pre-confirmations.Decentralized block building allows for more equitable participation in the block production process, reducing the risk of censorship and manipulation.Pre-confirmations provide users with a higher degree of certainty that their transactions will be included in the next block, leading to faster and more predictable transaction times.

In essence, Based Rollups propose a system where L2 functionality is tightly integrated with the Ethereum base layer, leveraging its existing security and decentralization. Related: Based Rollups pitched as fix to Ethereum incentives amid L2 fee debate The based movement represents a significant shift in Ethereum's ecosystem, addressing key challenges around fragmentation and scalability, according to a Jan. 24 blog post.This is a significant departure from traditional L2 designs that operate more independently.

The Potential Benefits of Based Rollups

The proponents of Based Rollups argue that this architecture offers several significant advantages over existing L2 solutions. Based Rollups pitched as fix to Ethereum incentives amid L2 fee debate Cointelegraph Blog all41author Septem 0These advantages address the core concerns surrounding incentive alignment, economic sustainability, and overall network health.

• Enhanced Incentive Alignment: By leveraging L1 validators for sequencing, Based Rollups directly align the incentives of L2 users with those of ETH stakers.Validators are rewarded for including L2 transactions, increasing the value of staking ETH and potentially leading to higher staking yields.
• Reduced Revenue Leakage: The revenue generated from sequencing transactions on the L2 is directed back to the Ethereum validators, rather than being captured by a separate sequencer entity.This strengthens the economic foundation of the Ethereum network.
• Increased ETH Demand: The potential for increased staking yields and the overall improvement in Ethereum's economic model could drive greater demand for ETH. 🔸Based Rollups pitched as fix to Ethereum incentives ami. 🔸Based Rollups pitched as fix to Ethereum incentives amid L2 fee debate.Some estimates suggest a potential 100-fold increase in long-term ETH demand.
• Improved Security: By relying on the security of the Ethereum base layer, Based Rollups inherit the robust security guarantees of the mainnet.This eliminates the need for L2s to establish their own security mechanisms.
• Simplified Architecture: Removing the need for a dedicated L2 sequencer simplifies the overall architecture and reduces the complexity of the system.
• Potential for Deflationary Issuance: With validators earning more fees, it can result in deflationary issuance again by aligning incentives between Ethereum L2 and its base layer validators.

These potential benefits have generated considerable excitement within the Ethereum community, with many viewing Based Rollups as a promising solution to some of the key challenges facing the ecosystem.

Addressing Concerns and Potential Drawbacks

While Based Rollups offer a compelling vision for the future of Ethereum scaling, it's essential to acknowledge potential challenges and drawbacks. Crypto commentators have pitched Based Rollups as a possible solution for improving Ethereum network economics while aligning incentives with layer-2 blockchains.The implementation and adoption of this architecture may not be straightforward, and there are concerns that need to be addressed.

• Validator Overload: Assigning the responsibility for sequencing L2 transactions to L1 validators could potentially overload them and introduce new complexities to the block proposal process.Mechanisms to prevent resource exhaustion and maintain network stability need to be carefully considered.
• MEV Considerations: MEV opportunities still exist within Based Rollups. Based rollups offer a solution by minimising the reliance on centralised L2 sequencers, and instead, introducing decentralised block building and pre-confirmations for better user experience (UX). In based rollups, L1 block proposers replace L2 sequencers, allowing them to include a rollup block in an L1 block in a permissionless manner.While the validators capture a portion of this value, mechanisms to mitigate harmful MEV extraction are still necessary.
• Latency and Performance: Integrating L2 sequencing directly into the L1 block production process could potentially impact latency and performance.Optimizing the integration to minimize any negative impact on transaction speeds is crucial.
• Implementation Complexity: Implementing Based Rollups requires significant changes to the Ethereum protocol and the L2 infrastructure. Some commentators note that Based Rollups align incentives between Ethereum layer 2 and its base layer validators, which could result in deflationary issuance again.This requires careful planning, rigorous testing, and broad community consensus.
• Risk of Centralization: Although designed for decentralization, the block proposal process in Ethereum L1 could still lead to centralization if only a few large validators dominate the selection of L2 transactions.

These concerns highlight the need for thorough research, careful design, and ongoing monitoring to ensure that Based Rollups are implemented effectively and do not introduce new vulnerabilities or inefficiencies.

The L2 Fee Debate and Based Rollups' Solution

The ""L2 fee debate"" revolves around the question of how transaction fees generated on L2 networks should be distributed and whether they adequately benefit the Ethereum base layer. [ Octo ] The Wealth-Building Alternative to Real Estate for Millennials and Gen Z Cryptocurrency [ Octo ] Crypto.com sues the US SEC after Wells notice RegulationThe concern is that L2s are siphoning away transaction volume and associated fees from Ethereum, potentially undermining the economic sustainability of the L1 network.

Based Rollups directly address this concern by funneling the fees generated from L2 transaction sequencing back to the Ethereum validators.This creates a direct link between L2 activity and the profitability of ETH staking, incentivizing validators to support and participate in the Based Rollup ecosystem. Based Rollups pitched as fix to Ethereum incentives amid L2 fee debate Some commentators note that Based Rollups align incentives between Ethereum layer 2 andThis mechanism helps to realign incentives and ensure that the Ethereum base layer benefits from the growth and adoption of L2 scaling solutions.

Furthermore, some commentators believe that this system could lead to deflationary issuance of ETH, further increasing its value and incentivizing long-term holding. Based Rollups pitched as fix to Ethereum incentives amid L2 fee debateSome commentators note that Based Rollups align incentives between Ethereum layer 2 andThis would occur if the fees earned by validators through L2 sequencing offset the ETH issuance rate.

Based Rollups vs. Based Rollups, a layer-2 scaling solution that uses layer-1 validators for processing instead of their own sequencers, could directly impact the monetization of Ethereum by making a pretty fundamental change to incentive structures, Cinneamhain Ventures partner Adam Cochran said in a Sept. 10 X post.Other L2 Scaling Solutions

To fully appreciate the significance of Based Rollups, it's helpful to compare them to other prominent L2 scaling solutions, namely Optimistic Rollups and ZK-Rollups.

• Optimistic Rollups: These rollups assume that transactions are valid unless proven otherwise. HTX DAO将联合波场TRON举办TOKEN2025 AfterpartyThey rely on a fraud-proof system where validators can challenge invalid transactions. Based Rollups will transform Ethereum's economic model by making staking more valuable and enabling competitive bidding for idle processes, potentially increasing long-term ETH demand 100-fold.Optimistic Rollups typically have longer withdrawal times due to the fraud-proof window. A new solution known as based rollups appears to be addressing this conundrum, proposing a scaling framework to realign Ethereum s L2 ecosystem by returning transaction sequencing control back to its decentralised validator network.They generally require a centralized or decentralized sequencer.
• ZK-Rollups: ZK-Rollups use zero-knowledge proofs to verify the validity of transactions.This eliminates the need for a fraud-proof window, resulting in faster withdrawal times.However, ZK-Rollups are more complex to implement and require specialized hardware. Related: Based Rollups pitched as fix to Ethereum incentives amid L2 fee debate. The estimates are based on anticipated value accrual to ETH holders from transaction fees as Ethereum processes aThey also typically rely on a centralized or decentralized sequencer.

Here's a table summarizing the key differences:

Based Rollups stand out due to their elimination of a dedicated sequencer and their direct alignment of incentives with L1 validators.While they may introduce implementation complexities, their potential benefits in terms of economic sustainability and security are significant.

The Based Movement: A Shift in the Ethereum Ecosystem

The concept of Based Rollups represents a broader ""Based movement"" within the Ethereum ecosystem. Related: Based Rollups pitched as fix to Ethereum incentives amid L2 fee debate. The based movement represents a significant shift in Ethereum's ecosystem, addressing key challenges aroundThis movement aims to realign incentives, reduce reliance on centralized entities, and strengthen the economic foundation of the Ethereum network. Based Rollups pitched as fix to Ethereum incentives amid L2 fee debate Some commentators note that Based Rollups align incentives between Ethereum layer 2 and its base layer validators, whichIt emphasizes principles of decentralization, security, and community governance.

The Based movement is a response to concerns about the increasing influence of centralized entities within the DeFi space and the potential for rent extraction and manipulation. Based Rollups could provide a solution to the issue of Ethereum s layer-2 networks pulling liquidity and revenue from the blockchain s base layer. BaseIt seeks to create a more equitable and sustainable ecosystem where all stakeholders benefit from the growth of the network.

Examples of Based Rollups in Development

While Based Rollups are still in their early stages of development, several projects are exploring and implementing this architecture. Based Rollups could provide a solution to the issue of Ethereum s layer-2 networks pulling liquidity and revenue from the blockchain s base layer. Based Rollups, a layer-2 scaling solution that uses layer-1 validators for processing instead of their own sequencers, could directly impact the monetization of Ethereum by making a pretty fundamental change to incentive structures, [ ]It's important to note that these projects are experimental, and their success will depend on their ability to address the technical challenges and gain community adoption.

Unfortunately, as of this writing, specific, publicly available examples of fully functional Based Rollups are limited. Based Rollups的Layer 2扩展解决方案可以从以太坊基础层提取流动性和收入。验证者可以通过加入Based Rollups流程获得额外奖励，提高质押ETH的价值和收益。这种机制协调了第2层和第1层验证者之间的激励措施，实现零发行通胀，保持较高的质押收益率。以太坊开发者Eric Connor认为，加密货币的未来将通过The concept is relatively new, and most projects are still in the research and development phase.However, keep an eye out for announcements and updates from Ethereum infrastructure providers and research teams.The best way to stay informed is to actively participate in the Ethereum community, follow relevant blogs and social media accounts, and attend industry conferences.

The Future of Ethereum Scaling: A Based Rollup World?

The future of Ethereum scaling is likely to involve a combination of different L2 solutions, each with its own strengths and weaknesses.Based Rollups represent a promising addition to this landscape, offering a unique approach to incentive alignment and economic sustainability.

Whether Based Rollups will become the dominant scaling solution remains to be seen.Their success will depend on overcoming the technical challenges, gaining community support, and demonstrating their ability to deliver tangible benefits in terms of performance, security, and economic value.

However, the underlying principles of the Based movement – decentralization, incentive alignment, and community governance – are likely to play an increasingly important role in shaping the future of Ethereum.As the ecosystem continues to evolve, solutions that prioritize these principles are likely to gain greater traction and contribute to the long-term success of the network.

Conclusion

Based Rollups present a compelling vision for the future of Ethereum scaling, addressing critical issues related to incentive alignment and revenue distribution within the L2 ecosystem.By leveraging Ethereum L1 validators for transaction sequencing, they offer a path towards a more sustainable and economically sound future for the network.The potential benefits, including enhanced ETH staking yields, reduced revenue leakage, and increased ETH demand, are significant.

While challenges and potential drawbacks exist, the underlying principles of the ""Based movement"" – decentralization, security, and community governance – are vital for the long-term health of Ethereum.As the ecosystem evolves, embracing these principles will be crucial for creating a thriving and equitable platform for innovation and growth.

The journey towards a fully scalable and decentralized Ethereum is ongoing.Based Rollups represent an exciting step in that direction, offering a fresh perspective on how to align incentives and build a more robust and sustainable future for the world's leading smart contract platform.It will be crucial to follow the development and adoption of these architectures to fully assess their impact on the Ethereum ecosystem.What will the adoption rates of Based Rollups look like in 5 years?Only time will tell.