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Ethereum co-founder Vitalik Buterin shares his vision for Layer 3 protocols

While Ethereum-based Layer 2 solutions have focused on hyperscaling the network, Ethereum co-founder Vitalik Buterin believes Layer 3 will serve a much different purpose – providing “custom functionality.”

Buterin shared his thoughts in a Saturday post, providing three “visions” for what Layer 3s will be used for in the future.

The Ethereum co-founder said a third layer on the blockchain only makes sense if it provides a different function from Layers 2, which were primarily used to improve scaling via Rollup technology zero-knowledge (zk):

“A three-layer scaling architecture that involves piling the same scaling scheme on top of itself generally doesn’t work well. Rollups on top of rollups, where both layers of rollups use the same technology, certainly don’t.

But, “a three-layer architecture where the second layer and the third layer have different purposes, however, can work,” Buterin said.

One use case for Layer 3 would be what Buterin describes as “custom functionality” – referring to privacy-based applications that would use zk proofs to submit privacy-preserving transactions to Layer 2.

Another use case would be “custom scaling” for specialized applications that don’t want to use the Ethereum Virtual Machine (EVM) to perform computations.

Buterin also said Layer 3 could be used for “loosely reliable” scaling via Validiums, a zk-proof technology. Buterin said it could be beneficial for “enterprise blockchain” applications by using “a centralized server that runs a validium prover and periodically validates hashes to chain.”

But, Buterin added that it is still unclear whether Layer 3 structures will be more efficient than the current Layer 2 model when it comes to building custom applications on Ethereum.

Layer 2 versus Layer 3 network architecture. Source: Starware.

Related: A beginner’s guide to understanding the layers of blockchain technology

“A possible argument for the three-layer model versus the two-layer model is: a three-layer model allows an entire sub-ecosystem to exist in a single aggregation, which allows cross-domain operations within this ecosystem to happen very cheaply, without the need to go through the expensive Layer 1,” Buterin said.

But, Buterin said that because cross-chain transactions can be performed easily and cheaply between two Layer 2s that have committed to the same chain, building Layer 3s does not necessarily improve network efficiency.

Buterin’s comments on possible Layer 3 use cases come as StarkWare’s newly produced recursive validity proofs seem to have possibly put an end to Ethereum’s scalability issues.

Declan Fox, the product manager of Ethereum software company ConsenSys, recently told Cointelegraph that “with recursive accumulations and proofs, we can theoretically scale infinitely.”

These recursive proofs have been well tested in production, with StarkWare co-founder Eli-Ben Sasson recently telling Cointelegraph that his recursive proofs have accumulated up to 600,000 non-fungible tokens in a single transaction on Immutable X and that 60 million transactions could soon be on the cards “with more engineering and tweaking”.

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