Justin Bons, founder of Cyber Capital, has criticized Ethereum's Layer-2 (L2) solutions. He calls networks like Arbitrum, Base, and Optimism a "dystopian nightmare of centralization."
Bons targets several top L2 solutions. He argues they have centralization risks that could allow network operators to control user funds.
The centralization comes from "multi-sig" controls and centralized sequencers. These can potentially manipulate transaction order or freeze funds.
Bons highlights specific vulnerabilities. Arbitrum and Base rely on multi-sig controls and permissioned proposers. This could allow instant access to user funds by a centralized authority.
"Arbitrum – Can steal all user funds instantly with a multi-sig, has permissioned proposers, centralized operator can exploit MEV & centralized sequencer can censor," Bons stated.
He noted similar issues with Base. "Base can steal all user funds instantly with a multi-sig, permissioned proposer can also steal all user funds, the centralized validator can freeze all funds, a centralized operator can exploit MEV & the centralized sequencer can censor."
Optimism faces similar centralization concerns. Bons points out its ability to exploit maximal extractable value (MEV) and censor transactions.
The industry reaction was mixed. Crypto pundit DBCrypto supported Bons' claims. He questioned the incentives for L2s to adopt a shared sequencer model.
"Coinbase currently makes how many millions a month off Base? OP and ARB hold around 50% L2 market share currently? Will they choose to join a shared sequencer and give up much of their earnings?" DBCrypto asked.
Bons expressed concern about broader implications. He cited naivety of engineers and misaligned venture capital incentives as factors. "VCs make much more money off ETH in the short term if it continues with L2 scaling," he concluded.