As blockchain ecosystems evolve, new infrastructure layers are emerging to address the growing need for scalability, interoperability, and efficiency. Blockchain development teams have turned toward different approaches to tackle these challenges. 

In a panel discussion at Permissionless III, Harry Kalodner, CTO of Offchain Labs, and Mark Boiron, CEO of Polygon Labs, discussed the differences between Layer 3 (L3) solutions such as Arbitrum Orbit and AggLayer.

L3s are blockchain networks designed to enhance the scalability of Layer 2 (L2) chains. L3s offer additional flexibility, customization, and cost savings by allowing applications to focus on specific use cases. L3s can settle their transactions onto an L2 chain rather than directly on Ethereum’s Layer 1 (L1). AggLayer, on the other hand, is a modular scaling solution that allows chains to securely transfer assets and aggregate proofs for more efficient settlements on L1 chains such as Ethereum.

Below is a recap of the conversation between Kalodner and Boiron, which helps readers better understand the similarities and differences between these scaling solutions.

A Focus on Customization

Kalodner and Boiron noted that scaling solutions are designed to enable decentralized applications to further customize their tools and solutions.

Boiron remarked that general-purpose chains will likely “become dinosaurs” in the industry soon, and development teams will likely seek greater differentiation between infrastructure options. Kalodner agreed, noting that two areas of customization have become highly sought after: custom gas tokens and data availability layers.

When asked what developers should consider when choosing the right solution, Boiron highlighted AggLayer’s neutrality and flexible design, which allows developers to integrate with any technology stack. In contrast, Kalodner emphasized that infrastructure costs should be the top priority.

“One of the challenges many teams running chains face is related to infrastructure,” Kalodner said. “There’s been a general belief with ZK technology that you could rely on a single, highly-powered super node because you don’t need many people running nodes for security. However, you still need infrastructure for block explorers, indexers, oracles, and other essential components to run a chain. This has been one of the barriers for teams trying to create a cohesive chain environment similar to what you get on Ethereum at a relatively low cost.”

Data Posting and Settlement

The cost of posting data highlighted Kalodner's and Boiron's differing perspectives on how settlement and block space are valued and optimized.

Boiron explained that AggLayer is designed to aggregate proofs across many chains, allowing them to post collectively on Ethereum. This aggregation would occur at intervals, reducing the overall cost of posting data.

Kalodner pushed back on the idea that block space could be interchangeable or commoditized, noting that chains like Ethereum, Arbitrum, and Polygon offer valuable block space due to high liquidity and many applications. Posting data more frequently to these chains can increase settlement speed but also incur higher costs.

Kalodner noted that Arbitrum Orbit chains should have the flexibility to choose how often they wish to post data to the parent chain. For these Orbit chains, this feature is called Fast Withdrawals, offering a way to achieve fast finality at low cost by introducing trust assumptions.

While Boiron agreed that L3 chains may currently offer cheaper settlements than AggLayer, he noted that, in the future, proof aggregation may make direct settlements to Ethereum more cost-effective.

Addressing Interoperability

Kalodner and Boiron had varying perspectives on blockchain interoperability and the unification of users and liquidity across ecosystems.

Boiron believed that fragmentation is an issue not just within Ethereum but across all of Web3. He emphasized the need to create a system where chains could connect and make their own decisions while being part of a unified network. Boiron noted that AggLayer’s focus is on creating an unopinionated and straightforward network that any chain can connect to, reducing complexity in cross-chain transfers. This way, liquidity can be unified across chains, creating a seamless user experience.

Kalodner agreed that addressing liquidity fragmentation in decentralized finance (DeFi) is essential, but he noted that not all blockchain use cases are liquidity-dependent. He emphasized that while solving fragmented liquidity is important, the bigger issue is addressing user fragmentation. For now, he said, the focus has been on creating infrastructure that allows for scalable growth and broader adoption.