๐ **Bitcoin Layer-2 Rollups Face Economic Hurdles, Says Galaxy Research** ๐
Galaxy Research has raised eyebrows with its latest report on Bitcoin Layer-2 (L2) scaling solutions, particularly rollups. While these solutions promise cheap, fast, and decentralized transactions, they might hit a financial wall due to Bitcoinโs limited blockspace and high costs. ๐
Bitcoinโs blockspace is capped at 4MB per block, and rollups using zero-knowledge (ZK) proofs can consume up to 10% of this space per transaction. With Bitcoin blocks consistently full since January 2023, this could lead to soaring transaction fees, making rollups economically unsustainable. ๐ธ
The report suggests rollups might need to explore alternative data availability (DA) layers like Celestia or Near, or restructure as Layer 3 solutions to stay viable. The future of Bitcoin rollups hinges on balancing high costs with user attraction and revenue generation. ๐
Stay tuned, BTC enthusiasts! ๐
