Justin Bons, founder and chief investment officer of European cryptocurrency fund Cyber ​​​​Capital, has once again criticized the operation of Ethereum L2 solutions. In last post X on Saturday, Bons labeled blockchain platforms that aim to improve the scalability of the Ethereum network as unsafe because they can steal user funds with impunity.

Is Ethereum L2’s centralized design a problem?

According to Justin Bons, most mainstream Ethereum L2 solutions are centralized, with single servers often responsible for handling platform operations. Cyber ​​​​Capital’s CIO states that such a construction, contrary to the principle of decentralization and security of cypherhunk, can be considered harmful to investors as these chains can collapse at any time due to a single event and can even be used to steal user funds.

To support these claims, Bons cited Consensys’ Linea zkEVM Roll-up network, whose management initiated a block production halt on June 2, 2024 due to a bug in the platform’s intelligent contract.

The respected cryptocurrency researcher also noted a two-hour outage of the Optimism chain that occurred on February 15, 2024, due to a bug in the network’s centralized sequencer. In addition to these examples, Justin Bons’ report also found similar incidents involving other Ethereum L2 solutions such as Starknet, ZkSync, Arbitrum, and Polygon. All of these incidents can be linked to the centralized nature of these projects.

The Cyber ​​​​Capital founder voices significant disagreement with these L2 solutions, stating that they do not offer the same level of security and stability as the Ethereum mainnet. He further states that while an adverse scenario such as losing user funds has not yet happened, the fact that such a potential exists is highly worrying.

Interestingly, these statements follow on from Bons’ previous claims that Ethereum has entered into a parasitic relationship with L2, whereby these platforms now operate almost independently of the main network while retaining significant control over liquidity and other factors crucial to the Ethereum ecosystem.

Ethereum poised for further price decline

In other news, popular cryptocurrency analyst Ali Martinez I have a postulated that Ethereum could still maintain its downtrend for now. Notably, the prominent altcoin delivered disappointing results in August, losing 22.36% of its value. According to the MVRV (180-day) momentum, which measures the change in the ratio of market value to realized value over 180 days, Ethereum still appears largely overvalued. Therefore, its downtrend is likely far from reversing.

At the time of writing, the second-largest cryptocurrency exchange is trading at $2,500, having recorded a compact loss of 0.99% over the past day. Meanwhile, the asset’s daily trading volume is down 55.75% and is valued at $6.85 billion.