Which items will stand out in the next L1 battle?

[wilkine]

The L1 battle is no longer a new concept for crypto investors. Still, as old L1s continue to be refined and new ones emerge, investors who don't keep up with the narrative risk being left out of the development wave.

The first Battle of L1

In 2018, when I first entered the crypto market, an OG told me, "Invest in ETH, its price has halved, the bottom has been reached," which is also my opportunity to enter the market. At that time, projects such as Ethereum were not yet called L1, but smart contract platforms.

During this period, many smart contract platforms such as Cardano, NEO, Tron, EOS and Monero were created to solve Ethereum's scalability problem (transaction speed + transaction fees), so they were also dubbed "ETH killers" by investors. However, most of the "ETH killers" are now either gone or barely heard of.

The Second L1 Battle

The second L1 battle took place in the most recent market cycle (2020-2024), and the main task is again to solve the expansion of Ethereum, although the goal is the same, but this war seems to be more diverse than the last cycle's war.

This battle focuses on the underlying blockchain with the following characteristics:

Multi-chain blockchains: Cosmos, Polkadot, and Avalanche.

Monolithic blockchain: Solana, Near Protocol, Fantom, Celo,...

Looking back at the first two L1 battles, we can find that although the L1 narrative is a relatively new concept, it has maintained its appeal to investors since its emergence.

However, the next generation of L1 projects is larger and more powerful than the previous two.

Therefore, I predict that projects such as Sui, Aptos, Aleo, Celestia, and Monad will lead the next L1 war in the next bull market.

Which projects will lead the next L1 battle?

1. Aptos

Aptos is one of the latest L1s to complete the distribution of tokens in the form of retroactive airdrops. Users who minted NFT on the Aptos test network received an average of $3,000 worth of APT tokens in airdrops.


Aptos extension solution

Aptos uses the Block-STM algorithm and BFT consensus mechanism to implement network transactions, aiming to solve the scaling problem and avoid the mistakes of Solana's multiple network resets. The parallel processing mechanism of the Aptos network can execute a large number of transactions simultaneously, resulting in network speeds of 160,000 TPS. In addition to the Move language, which is built on Facebook's Diem, Aptos can also build smart contracts using Rust.

The development of the Aptos ecosystem

After the introduction of APT tokens and massive airdrops to the community, the number of projects in the Aptos ecosystem skyrocketed. This shows that Aptos is off to a good start. However, most of the early ecological projects were of poor quality, and quite a few of them cheated users out of money.

However, the future of the Aptos ecosystem remains promising for several reasons:

Strong support from Binance &BNB Chain: Aptos is the first blockchain to be extended by PancakeSwap, demonstrating that Binance's support for Aptos goes beyond strategic investments.

Ecological highlight projects such as Thala Labs, Pontem, Aries Market, Totuga Finance and Martian Wallet have successfully completed financing. This proves that VC continues to bet on key components of the Aptos ecosystem.

In addition, adding support for Rust and many other well-known programming languages could help the Aptos ecosystem become more robust.

Despite the small number of quality projects in the Aptos ecosystem, it is a positive sign for the ecosystem that Aptos has had a relatively positive start in the long run and has left the impression that it is stronger than Sui.

Teams and Investors

There is no denying the talent of the Aptos #DevelopmentTeam , who worked hard at Facebook to build Diem.

Even after Mainnet went live, the project raised hundreds of millions of dollars and reached a valuation of $4 billion.

evaluate

Aptos addresses the scalability of Ethereum at the execution stage from a technical point of view.

The Aptos ecosystem is in its early stages, with few quality projects, but the future remains promising.

2. Sui

Unlike Aptos, Sui sparked controversy when the mainnet went live because it did not offer token airdrops for test net users. Instead, Testnet users were only whitelisted to buy SUI tokens at $0.03, which equates to a $300 million valuation.


The Sui solution

Sui is a monolithic blockchain, similar to Solana, Fantom, or Near Protocol. However, Sui and Aptos are very similar in that, unlike Solana, they chose to scale horizontally rather than vertically.

But while Aptos used parallel execution to settle multiple trades at once, Sui went in a different direction. The Narwhal-Tusk consensus algorithm is a key component of Sui's approach to solving the scalability problem, minimizing the communication needed between validators to process transactions to achieve lower latency.

As a result, Sui's TPS can be comparable to or even higher than Aptos without the need for Solana's standard nodes. It can also be said that Sui partially addresses the tradeoff between scalability, security, and decentralization of blockchain.

Development status of Sui ecosystem

Sui's ecosystem is still in the early stages of infrastructure development, so it has received little attention. Typically, it takes a year for a new L1 to set up infrastructure components such as wallets, cross-chain Bridges, prophecy machines, and apis before the ecosystem can enter a sustainable growth phase.

Teams and Investors

Similar to the Aptos #DevelopmentTeam , most of the Mysten Lab #DevelopmentTeam  responsible for building the Sui blockchain came from the Diem project. However, the number of Diem developers on the Sui Blockchain #DevelopmentTeam  is much higher compared to the Aptos team.

evaluate

The future of Sui cannot be accurately predicted at this time, because the most important factor is L1's own development strategy. But compared to its rival Aptos, Sui's #DevelopmentTeam  had more creativity in solving transaction problems. When it comes to scalability, Sui's solution is safer and more practical.

3. Monad

Monad is a new L1 that has recently attracted attention due to "airdrop speculation" caused by preparations for the launch of the test net.


The Monad solution

Unlike Sui and Aptos, Monad is an EVM blockchain with a PoS consensus mechanism and a TPS of up to 10,000. So what is it about Monad that makes it so fast?

Similar to Aptos, Monad uses parallel execution of transactions.

Development of the Monad ecosystem

Monad is still in the development phase and is ready to launch a testnet version in the near future, so there are currently no players in the Monad ecosystem.

Teams and Investors

Monad's #DevelopmentTeam  worked at TradFi giant Jump Trading for over 7 years. In addition, Monad has successfully raised $19 million from various VCS including Dragonfly Capital, Lemniscap, Shima Capital, and Palceholder.

evaluate

It is difficult to evaluate Monad at the moment, but with the limited information available, it is at least possible to validate the potential of the #DevelopmentTeam  by raising funding from a number of large VCS.

4. Aleo

Aleo is a new L1 designed to provide decentralized and fully private applications to all Web3 users through ZKP technology.

Aleo's solution

According to the Aleo documentation, the platform doesn't place a strong emphasis on scalability, but Aleo wants to provide privacy for all platform users with ZKP technology features.

The development of the Aleo ecosystem

The Aleo ecosystem is in the early stages of development, with eco-projects such as Leo Wallet, VolcaniX, Nucleo, Demox Labs... We still need a lot of time to follow up on the future Aleo ecosystem. At present, Aleo is still in the test network, the main network online time has not been announced.

Teams and Investors

Aleo has successfully raised a total of $298 million from a16z, Coinbase Ventures, Placeholder, Polychain Capital and others. Although Aleo's #DevelopmentTeam  isn't particularly impressive. Clearly, VCS have information we haven't discovered yet.

evaluate

We currently lack sufficient information to evaluate Aleo and require additional observation time. For a privacy project to get so much money and attention, perhaps the U.S. government might block Aleo, so will Aleo adjust its goals if and when it does come to that?

5. Celestia

Celestia is the crypto industry's first fully modular blockchain, so even though it hasn't raised as much money as Aptos or Sui, Celestia is still generating a lot of interest from the crypto community.


Celestia's solution

Traditional blockchains typically integrate functions such as consensus, settlement, data availability, and execution in a single architecture. However, as the complexity and demands of blockchain applications increase, a single architecture may not be able to meet the requirements of different scenarios. Celestia, as a modular blockchain, separates execution, consensus, and data availability.

Celestia's model is similar to Ethereum +Rollup L2. After the completion of the Ethereum 2.0 roadmap, Ethereum will also become a fully functional modular blockchain. Clearly, modular blockchains will be an important trend in the crypto market in the future.

State of development of the Celestia ecosystem

Celestia is still in the research and development stage, and the ecosystem is not yet formed.

Teams and Investors

The co-founders of the project are also senior developers at Cosmos, while the other team members also have a good pedigree.

evaluate

Celestia is growing at a much slower rate than Aptos and Sui because the technology they are trying to develop is so sophisticated.