Background
It’s no secret that TVL is a great indicator of stability, sustainability and popularity of a project/platform.
This proposal (which will follow) is designed to develop Morpho into a large-scale DeFi ecosystem.
Offer Description
I propose that the team consider and put to a vote to the community a proposal for the emergence of L2 networks (Optimism, Arbitrum), as well as the integration of ZkSync in Morpho. L2 networks are gaining a lot of momentum: TVL Optimism and Arbitrum is already more than 2 billion dollars and will continue to grow (the cost of air commissions in this helps).
Therefore, it is logical that Morpho needs liquidity, increased TVL, and volumes to develop. Through L2 networks we will be able to achieve a multiple of these indicators. And with the integration of Zk we will attract the attention of institutional investors (hidden payments, 2023-2024 zk-rollup).
After the adoption of one of the proposals we (the community) are not against discussing what reward(s) should be in these networks (and most likely less than on air, for objective reasons), but I think it will not be a strong obstacle to attract capital, users.
I agree with you about the emergence of L2 in the coming years.
However, if we look at AAVE’s TVL (Compound seems to be only on the mainnet), L2s still seem to be very much in the back seat for the moment.
So although I agree with you on their potential, I wonder about the timing, shouldn’t Morpho
first let the underlying protocols (AAVE and others) develop on L2 and increase their TVL there before imagining adding the MORPHO layer?
Thank you for the time you spent on this post! L2 deployment is certainly something worth discussing and is something Morpho Labs has considered but is not something we’d vote in favor of at this stage.
The reasons are primarily operational constraints: managing deployments on multiple networks is operationally intensive. It requires many resources to deploy, maintain and monitor instances of Morpho. We don’t believe the potential benefits to Morpho are commensurate with the time and resources we’d have to allocate to it. Instead, we prefer to focus on opportunities with a higher return on resources.
Noting this is only the opinion of Morpho Labs and does not reflect the opinion of Morpho DAO.
Totally agree, maybe we (Morpho community) could suggest this idea to the compound and AAVE, I think they would understand the potential of L2 networks
Thank you, I was supposedly aware that it all costs a lot of effort and money, hopefully in the future there will be an option (investment from users, foundations) enough to start a deployment on L2, as well as specialists capable of calculating all the risks, nuances, and technically talented.
