Written by: yyy, Deep Tide TechFlow

The overall TVL of the Layer 2 track has recently touched the $10 billion mark, presenting a "prosperous" scene in the Layer 2 ecosystem. zkSync still ranks third in the L2 track, behind Arbitrum and Optimism, with an on-chain TVL of nearly $500 million.

Why do we say that the prosperity of the zkSync ecosystem is a false prosperity?

Before answering this question, let's take a look at the recent TVL trends of the two big brothers in Layer 2, Arbitrum and OP.

According to L2Beat data:

• Arbitrum's TVL fluctuates around $6 billion;

• OP has seen frequent positive news recently, with its TVL reaching a new high, breaking the ATH of $2.5 billion;

Both have a combined TVL share of nearly 85% in the L2 track, occupying an absolute dominant position.

In contrast, zkSync has experienced a sharp decline in TVL due to the recent fallout from the community's "random" airdrop NFT incident. Funds have fled, with most of the capital flowing into another yet-to-be-launched zk-Rollup, StarkNet. StarkNet's on-chain TVL has increased by nearly 34% in a week.

To conclude: The on-chain prosperity of zkSync is based on the potential airdrop expectations brought by airdrop hunters. At least for now.

Next, I will argue the above conclusion from three points: the complexity of the on-chain ecosystem, the breadth of infrastructure applications, and the NFT "random" airdrop incident.

(p.s. The degree of false prosperity in the on-chain ecosystem cannot be quantified, but the "pseudo" prosperity of zkSync far exceeds that of Arbitrum and OP.)

Complexity of the On-Chain Ecosystem

The complexity of the on-chain ecosystem represents innovation capability, which can bring more diversified application scenarios to users, thereby stimulating user demand. For L2, the complexity of the on-chain ecosystem ≈ the complexity of on-chain DeFi. This kind of DeFi Lego with certain Ponzi attributes is particularly important for the prosperity of the on-chain ecosystem.

First, let's look at the big brother Arbitrum:

The leading protocol GMX has a TVL of $500 million, making it one of the best decentralized derivatives trading protocols in the crypto market, and also one of the few complex DeFi protocols that have survived for a long time. Additionally, there is the lending protocol Radiant Capital, which recently received funding from Binance, enabling cross-chain lending applications based on L0 infrastructure.

Now let's take a look at the second brother OP:

The leading protocol is a 33 DEX Velodrome, innovated based on Solidly's imitation, which has now become a crucial hub in the OP ecosystem, radiating to other protocols in the ecosystem. Sonne Finance has risen based on Velodrome and is currently the largest native lending protocol in the OP ecosystem. It has created a positive economic flywheel through bribery and locking mechanisms, benefiting the OP ecosystem.

In summary:

• Arbitrum: Complex derivatives trading, cross-chain lending, and other innovative application scenarios;

• OP: Imitation of Ethereum's Curve ecosystem bribery to achieve a positive economic flywheel.

It can be said that the complexity of the on-chain ecosystem is a necessary but not sufficient condition for the prosperity of the on-chain ecosystem; complex DeFi Lego is certainly the foundation of a prosperous ecosystem.

Now let's take a look at the third brother zkSync:

SyncSwap is the absolute leader, with a TVL of $82 million, accounting for nearly half of zkSync's TVL.

We won't elaborate on the leading protocols here, as they have recently gained "notoriety." On-chain entrepreneurial projects and low-quality tokens are rampant, with the main theme being "rug." Airdrop hunters have propped up half of zkSync's TVL.

Breadth of Infrastructure Applications

OP/Arbitrum/zkSync have all launched modular stacks for developers to easily start L2/L3.

• OP: OP Stack;

• Arbitrum: Arbitrum Orbit;

• zkSync: zkSync HyperChain.

Currently, the most widely used is undoubtedly OP Stack.

After Coinbase announced the construction of L2 Base based on OP Stack, more and more projects have joined this camp: including but not limited to: Binance opBNB, a16z, Worldcoin, Zora, Manta Network.

The derivatives trading protocol Syndr recently announced the construction of an L3 application chain based on Arbitrum Orbit. Protocols like Relative and OthersideMeta also have intentions to build L3 based on Orbit.

In contrast, there is little discussion in the crypto market about zkSync's L3 architecture HyperChain, let alone building zk L3 based on HyperChain.

NFT "Random" Airdrop

zkSync officially airdropped NFTs to 10,000 "random" addresses of its ecosystem users, which were later revealed to be mostly addresses starting with 0x0, including some inactive addresses with 0 transactions or only 1-2 transactions. Under pressure from public opinion, the official clarified that their definition of "random" was inaccurate and referred to the first 10,000 qualified addresses.

This NFT "random" airdrop incident became the trigger for zkSync's TVL to plummet sharply, with a drop of nearly $80 million in just one week, a decline of over 16%.

At the same time, zkSync's competitor—also a potential token project StarkNet—saw its TVL increase by nearly 35% during the same period.

There is reason to believe that this significant fluctuation of funds between chains is largely due to the change in strategies of the airdrop hunters.

This also indirectly confirms that there are very few users with real demand on zkSync; the prosperity of the on-chain ecosystem is "pseudo-prosperity," derived from the demand based on zkSync's token issuance expectations.

For the other two big brothers, Arbitrum and OP, both have issued tokens. Of course, there are expectations of retroactive airdrops after token issuance, but it cannot be denied that there are more users with real and diversified trading demands on Arbitrum/OP.

Here, I can subjectively say: without the airdrop hunters, zkSync would be nothing.

Faced with such an on-chain ecosystem and "active" users, I dare to ask: does zkSync dare to issue tokens now? Once the expectations of token issuance are eliminated, it is clear who is more capable.

In the end, it is still that old saying: when the tide goes out, we will know who is swimming naked.