The chief product officer of Coinbase foresees that there will be more advances in layer-one to layer-two bridges and rollup technologies.
Coinbase chief product officer Surojit Chatterjee is the latest to publish his predictions for the crypto industry in 2022, and he foresees major advances in the scaling of Ethereum.
Industry leaders, analysts and investors have been sharing their 2022 predictions for the crypto ecosystem, and Coinbase’s Chatterjee is confident that Ethereum will be at the forefront of Web3 and the crypto-economy as it scales.
The CPO shared his predictions in a company blog post on Tuesday in which he stated that Ethereum’s scalability will improve, but alternative layer-one networks will also see traction.
He added that newer layer-one networks focused on gaming and social media will also emerge. Chatterjee predicts that scalability will be vastly improved by advances in layer-oneto-layer-two bridges, adding that the industry will “desperately seek improvements in speed and usability of cross-L1 and L1-L2 bridges.”
These bridges enable tokens to be moved from a layer-one network, such as Ethereum, to a layer-two network, such as Arbitrum, and vice versa.
Referring to scaling technologies, the CPO specifically mentioned zk-Rollups, stating that they will “attract both investor and user attention.” Zero-Knowledge scaling “rolls up” transactions data in batches for more efficient processing on Ethereum’s layer one.
Firms such as Matter Labs have advanced in leaps and bounds in 2021 with the development and deployment of its rollup-based zkSync layer-two platform.
The layer-two ecosystem has undergone massive expansion in 2021 with a surge in adoption for all major platforms. According to L2beat, which tracks layer-two ecosystems, the total value locked surged by nearly 11,000% over the past year from around $50 million in January 2021 to $5.5 billion by the end of the year.
Related: Even with Ethereum 2.0 underway, L2 scaling is still key to DeFi’s future
Chatterjee predicted that there will be more privacy-focused applications emerging, but this could attract more regulatory attention as more Know Your Customer and Anti-Money Laundering restrictions are enforced.
Other predictions he made include more regulation industry-wide, larger institutional participation in decentralized finance (DeFi), the emergence of more DeFi insurance, greater brand involvement in metaverses and nonfungible tokens, and Web2 companies scrambling to get into Web3.