Ethereum (ETH): why L2 adoption is shifting activity away from mainnet

Explore why Ethereum Layer‑2 solutions are pulling activity off the mainnet in 2025, the impact on users and the rise of tokenized real‑world assets.

• Layer‑2 scaling has become the dominant mechanism for reducing gas costs on Ethereum.
• Mainnet congestion continues to hurt retail traders and DeFi users alike.
• Eden RWA demonstrates how tokenized real‑world assets fit into this new ecosystem.

In late 2024, Ethereum’s mainnet was still a popular venue for decentralized finance (DeFi) protocols and non‑fungible tokens (NFTs). Yet by early 2025 the network’s transaction fees were reaching record highs, prompting users to migrate to Layer‑2 solutions such as Optimism, Arbitrum, zkSync and StarkNet. The shift is not just a technical footnote; it reshapes how investors interact with Ethereum, where liquidity flows, and what kinds of assets can be built on the platform.

For the average retail investor who has watched ETH rise from $200 to over $4,000 in 2023, the question is clear: why should I move my capital off the mainnet? And how does this movement affect the burgeoning sector of real‑world assets (RWA) that rely on Ethereum’s infrastructure?

This article examines the mechanics behind Layer‑2 adoption, its market implications, and a concrete example—Eden RWA—that illustrates how tokenized luxury real estate can thrive in an L2‑heavy environment. By the end you’ll understand why mainnet activity is shifting, what it means for your portfolio, and which signals to watch as the ecosystem evolves.

Background: Layer‑2 Scaling and Ethereum’s Mainnet Challenges

Ethereum’s proof‑of‑stake (PoS) upgrade in 2022 reduced energy consumption but did not solve throughput limitations. The network can process roughly 15–30 transactions per second, far below the capacity required for mainstream use. When demand spikes—such as during NFT drops or DeFi liquidity events—transaction fees rise sharply, sometimes exceeding $10 per operation.

Layer‑2 (L2) solutions were designed to address this bottleneck. They operate on top of Ethereum’s mainnet by aggregating multiple off‑chain transactions into a single batch that is settled back onto the base layer. There are two broad categories:

• Optimistic Rollups assume honest execution and only roll back if fraud proofs are presented.
• ZK-Rollups use zero‑knowledge proofs to verify state changes instantly.

Both approaches dramatically lower fees—often by an order of magnitude—and increase throughput to thousands of transactions per second. In 2025, the combined daily transaction volume on L2s surpassed that on Ethereum mainnet for the first time in history.

How Layer‑2 Adoption Works: A Step‑by‑Step Overview

The migration from mainnet to L2 involves several key actors and processes:

1. User: Initiates a transaction on an L2 via a compatible wallet (MetaMask, WalletConnect).
2. Rollup Operator: Validates the batch of transactions, produces a succinct proof, and submits it to Ethereum.
3. Mainnet: Receives the rollup proof, validates it, and updates its global state accordingly.
4. Smart Contract: Executes logic on L2, often using the same bytecode as mainnet contracts but with different gas models.

This architecture means that most of the computational work is done off‑chain, while security guarantees are anchored to Ethereum’s robust consensus layer. For users, the experience feels like a single network: they can send ERC‑20 tokens, interact with DeFi protocols or mint NFTs on L2 without leaving their wallet.

Market Impact & Use Cases

The practical benefits of Layer‑2 adoption are evident across several domains:

• DeFi Yield Farming: Lower gas costs enable smaller farms to remain profitable, attracting more liquidity providers.
• NFT Minting Platforms: Artists can release large collections without price gouging collectors for high transaction fees.
• Real‑World Asset Tokenization: Projects like Eden RWA can issue ERC‑20 property tokens on L2 to reduce operational costs and improve user experience.

A quick comparison shows the stark difference in cost and speed between off‑chain and on‑chain asset management:

These efficiencies translate directly into higher yields for investors and lower friction for everyday users.

Risks, Regulation & Challenges

While Layer‑2 scaling solves many technical bottlenecks, it introduces new risk dimensions:

• Smart Contract Vulnerabilities: Rollup operators rely on code that may have undiscovered bugs. A flaw could compromise thousands of transactions.
• Custodial Concentration: Some rollups are operated by a handful of entities, potentially creating points of failure or centralization concerns.
• Regulatory Uncertainty: Authorities like the SEC and MiCA in Europe are still defining how L2 tokens fit into securities law. Compliance requirements may evolve rapidly.
• Liquidity Fragmentation: As activity splits between mainnet and multiple L2s, liquidity pools can become thin, increasing slippage for traders.
• KYC/AML Constraints: Some DeFi protocols require identity verification on L2 to comply with regulatory standards, which could limit anonymity.

Real‑world examples illustrate these risks. In mid‑2024 a zkSync vulnerability exposed hundreds of users’ private keys, prompting a swift rollback and operator penalty. Meanwhile, the EU’s MiCA draft imposes licensing on any asset that can be used as collateral across chains, affecting L2-based lending platforms.

Outlook & Scenarios for 2025+

The trajectory of Ethereum’s Layer‑2 ecosystem hinges on several factors:

• Bullish scenario: Continued rollup innovation reduces fees to near-zero levels, attracting institutional flows and enabling mass adoption of tokenized assets like real estate.
• Bearish scenario: A major security breach or regulatory crackdown forces users back onto the mainnet, stalling L2 growth and driving up gas costs again.
• Base case (12–24 months): L2 adoption stabilizes at ~70% of total transaction volume. Mainnet remains relevant for high‑value, low‑frequency operations such as large cross‑chain swaps or governance votes.

Retail investors should watch fee trends, rollup operator audits, and regulatory announcements. Builders need to consider multi‑layer strategies—deploying core contracts on mainnet for security while moving user interactions to L2 for speed.

Eden RWA: Tokenized Luxury Real Estate Meets Layer‑2 Efficiency

As a concrete illustration of how real‑world assets can thrive in an L2‑heavy environment, Eden RWA offers fractional ownership of luxury villas across the French Caribbean. The platform tokenizes each property into an ERC‑20 asset—e.g., STB-VILLA-01 for a Saint‑Barthélemy villa—backed by a special purpose vehicle (SPV) that holds legal title.

Eden’s workflow integrates seamlessly with Ethereum’s mainnet and L2 rollups:

• Issuance of property tokens occurs on mainnet to leverage its immutable security.
• Daily rental income, paid in the stablecoin USDC, is distributed via smart contracts on an L2 layer (Optimism), ensuring low gas costs for payouts.
• A DAO‑light governance model lets token holders vote on renovations or sale decisions through a lightweight on‑chain voting system.
• Quarterly experiential stays are awarded by a bailiff‑certified draw, adding tangible value to token ownership.

The result is an accessible investment vehicle that combines the transparency of blockchain with the stability and yield potential of high‑end real estate. By leveraging L2 solutions, Eden keeps operational costs minimal while maintaining security through Ethereum’s mainnet backbone.

To learn more about Eden RWA’s upcoming presale, you can visit the official presale page or explore the dedicated presale portal at https://presale.edenrwa.com/. These links provide detailed whitepapers, tokenomics, and roadmap information.

Practical Takeaways for Investors

• Monitor Layer‑2 fee trends: a sudden spike may indicate congestion or operator issues.
• Check rollup operator audits and decentralization metrics to assess risk.
• Stay informed on regulatory developments in the EU (MiCA) and US (SEC).
• Evaluate tokenized RWA projects that use L2 for distribution—lower gas can mean higher yields.
• Consider diversifying across multiple L2 platforms to mitigate liquidity fragmentation.
• Verify smart contract security through third‑party audits before investing.

Mini FAQ

What is the difference between Ethereum mainnet and Layer‑2?

Mainnet processes transactions directly on the base layer, while L2 aggregates many off‑chain transactions into a single batch that settles on mainnet. This reduces fees and increases throughput.

Will moving to Layer‑2 affect my ETH holdings?

No. Your ETH remains on the mainnet; you only move specific tokens or interactions onto an L2 rollup for lower cost.

Is investing in tokenized real‑world assets safe?

Tokenized RWA projects typically perform legal due diligence and hold property through SPVs, but they still carry smart contract and regulatory risks. Perform thorough research before committing funds.

What are the main risks of Layer‑2 solutions?

Risks include operator centralization, smart contract bugs, liquidity fragmentation, and evolving regulatory requirements.

Can I use L2 for high‑value transactions?

L2 is most beneficial for frequent, low‑to‑medium value operations. High‑value transfers still favor mainnet to ensure maximal security.

Conclusion

The shift of Ethereum activity from the mainnet to Layer‑2 solutions is driven by the need for lower fees and higher throughput—factors that are critical for both retail users and sophisticated DeFi protocols. As L2 adoption deepens, tokenized real‑world assets like those offered by Eden RWA demonstrate how tangible value can be combined with blockchain efficiency.

For investors, the key takeaway is to stay informed on Layer‑2 fee dynamics, operator credibility, and regulatory developments while evaluating new opportunities that leverage this technology. The future of Ethereum will likely involve a hybrid model where core security remains anchored in mainnet, but day‑to‑day user interactions migrate to Layer‑2 for speed and cost savings.

Disclaimer

This article is for informational purposes only and does not constitute investment, legal, or tax advice. Always do your own research before making financial decisions.