Ethereum has long been a leading player among Layer 1 blockchains. However, with the advancements made by various blockchain companies, alternative Layer 1 solutions have emerged. Additionally, Layer 2 solutions are gaining traction in the industry, aimed at improving the scalability of existing Layer 1 networks.
Layer 1 blockchains serve as the foundational layer for on-chain transactions, governing the process and recording of transactions. In Web3, Layer 2 refers to off-chain networks or technologies built on top of Layer 1, with the goal of expanding capabilities, reducing congestion, and enhancing scalability through a separate transaction framework.
Recent research conducted by Binance reveals that certain blockchains have attracted more funding than others in 2023. Below is a breakdown of these figures and an overview of the infrastructure that has garnered the most attention from venture capitalists (VCs).
Q1 2023
Scroll has taken the lead in the first quarter of the year, securing $50 million in funding from investors. It is a zkEVM-based type 3 zkRollup on Ethereum, ensuring compatibility with existing applications and tools.
Fetch.ai closely follows Scroll, having received $40 million during the same period. Fetch.ai operates as an artificial intelligence and machine learning-based blockchain platform that facilitates data sharing and exchange.
The remaining three projects, Monad, Radix, and Conflux, secured funding as follows:
– Monad: $19 million
– Radix: $10 million
– Conflux: $10 million
Monad is a high-performance Layer 1 blockchain designed to simplify the development of decentralized applications.
Radix focuses on decentralized finance (DeFi) applications as a Layer 1 protocol.
Conflux, on the other hand, stands out as a Chinese regulatory-compliant, public, and permissionless Layer 1 blockchain that utilizes Tree Graphs.
Q2 2023
In the second quarter, EOS emerged as the leader of the group with a funding of $60 million. It is a Layer 1 blockchain that utilizes open-source software from the EOSIO foundation.
Berachain secured the second position with $42 million in a Series A round. This blockchain operates on the Cosmos SDK and is EVM-compatible. It stands out with its Proof of Liquidity Consensus mechanism, focusing on DeFi.
Receiving the third highest funding in Q2 was Sei Network, with an investment of $30 million. This general-purpose, open-source Layer 1 blockchain specializes in facilitating the exchange of digital assets.
Following Sei Network are Anoma Network with $25 million and Conflux with $18 million in funding.
Sei Network distinguishes itself with an intent-centric architecture that enables the construction of infrastructure layers and a new operating system for decentralized applications.
Q3 2023
In the third quarter, the leading projects in terms of funding are as follows: RISC Zero with a staggering $40 million, followed by ZetaChain with $27 million, Over Protocol with $8 million, Fhenix and EthStorage, both securing $7 million each.
RISC Zero stands out as a cutting-edge, scalable blockchain that incorporates zk proofs technology and RISC-V zkVM. ZetaChain, on the other hand, revolutionizes the industry by allowing omnichain functionality, generic smart contracts, and seamless messaging across various blockchains.
Over Protocol adopts a layer 1 approach, utilizing “Ethanos” protocol to empower full nodes with the capability to discard outdated data and operate with reduced storage requirements.
Fhenix presents itself as another layer 1 project, distinguished by its usage of fully homomorphic encryption via fhEVM. Lastly, EthStorage takes a layer 2 approach, providing a dynamic and programmable storage solution.
