Paul Rajchgod: Layer 2 blockchains are built on a lie

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Layer 2 blockchains are all the rage in the “crypto” ecosystem, hitting over $13 billion in overall market cap. However, Paul Rajchgod believes they are all built on a lie.

Rajchgod, the managing director of Ayre Ventures, was at the London Blockchain Conference, where he moderated a panel that delved into investing in Web3, the use of blockchain in various businesses, and Layer 2 blockchains.

“It’s my thesis that the whole premise of Layer 2 is built on a lie, and that lie is that Layer 1 wasn’t scalable. Layer 1 means using the blockchain itself and not building outside the blockchain,” Rajchgod told CoinGeek Backstage host Becky Liggero on the sidelines of the event.

Layer 2s are off-chain networks built atop blockchain networks to allegedly enhance qualities such as scaling, speed, or cut costs. They stem from an inability of the base networks to evolve to meet the changing needs of the users, with a lack of scale being the most common.

“Other blockchains are not scalable enough, and I believe that’s why they have had to figure out, ‘Well, we’ll do a Layer 2 thing,'” he said.

BSV scales unbounded to meet enterprise needs, making it the ideal blockchain network for applications that target millions of users, from games and social media platforms to government and enterprise services. With the Teranode upgrade later this year, BSV will process over a million transactions per second, making it the most scalable decentralized network globally and eclipsing the throughput of most centralized rivals.

At the London Blockchain Conference, many of Ayre Ventures’ portfolio companies took to the stage to offer updates on their products and services. According to Rajchgod, most have onboarded paying clients whom they are helping to build on Bitcoin, including MintBlue, Gate2Chain, and Buzzmint.

One of the key objectives of the conference is to connect blockchain leaders and enthusiasts with decision-makers from the enterprise and government sectors. Rajchgod revealed that the event had delivered on this mandate, with Ayre Ventures involved in dozens of meetings on the sidelines geared towards robust partnerships that can push blockchain adoption.

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