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Aave Governance Report Flags Over Half of L1 and L2 Deployments as Unviable

ACI’s status update shows most revenue comes from Ethereum mainnet, urging closure of low-performing networks and linking incentives to KPIs.

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Summary

Aave governance advocate group ACI reported that more than half of Aave’s cross-L2 and L1 deployments are economically unviable. Data for the year shows over 86.6% of the protocol’s revenue originates from the Ethereum mainnet. ACI recommends shutting down underperforming L2 networks and plans to propose performance incentives tied to key performance indicators (KPIs).

Terms & Concepts
  • Layer 1 (L1): The base layer of a blockchain network, such as Ethereum, responsible for transaction settlement and consensus.
  • Layer 2 (L2): A secondary framework or protocol built on top of a Layer 1 blockchain to improve scalability and transaction speed.
  • Key Performance Indicators (KPIs): Quantifiable metrics used to evaluate the success or performance of a project against set objectives.