ARK Analyst Slams Layer Two Networks as Bad Business for Ethereum

Ethereum's price dropped by 3.55% to $2,370 at the time of writing due to broader market selling pressure caused by fears of a US Federal Reserve interest rate hike.

An ARK Invest analyst, Lorenzo Valente, has stated that layer two networks are not adding value to Ethereum, citing Robinhood Chain's growth on Arbitrum. Despite DEX volumes and DeFi TVL reaching new highs, Ethereum only receives less than 1% of the revenue from Robinhood Chain.

Valente notes that Ethereum's share is a fixed data-posting cost, not a revenue share, calling it 'an extremely bad business for Ethereum.' Robinhood Chain has generated higher fees than Solana, Ethereum, and Base as transactions and DEX volumes rise.