Ethereum News Update: Security Concerns Arise for Ethereum's Layer 2 Solutions While Solana Attracts Increased Institutional Interest

Solana co-founder Anatoly Yakovenko has openly questioned the widespread belief that Ethereum's layer-2 (L2) scaling solutions truly benefit from the security of the

mainnet, sparking a larger conversation about the potential risks and centralization issues present in the growing L2 sector. Yakovenko, a strong proponent of high-speed blockchain technology, recently argued in a public forum that L2s do not possess the strong security assurances they are often credited with, especially when it comes to multi-signature management and intricate smart contract operations, according to .

Yakovenko's main criticism focuses on the technical shortcomings of Ethereum's L2s, which he believes introduce weaknesses that could put users' assets at risk. "Saying that layer-2s inherit ETH security is incorrect," he asserted, pointing out that L2s like Base and

ETH on encounter similar worst-case scenarios as Ethereum's main chain. He also highlighted that the rapid increase in L2 networks—now over 129 verified, according to L2Beat—has led to fragmented liquidity and reduced earnings for Ethereum's layer-1 (L1) stakers. This stance has received both agreement and criticism from industry leaders; for instance, Binance Research concurs that L2s disrupt L1's financial model, while others, such as Polygon's Anurag Arjun, argue that L2s are essential for scaling Ethereum.

The ongoing discussion about the security and usefulness of L2s comes as Solana sees increasing institutional interest. Fidelity Digital Assets has recently broadened its crypto services to include Solana (SOL), making it available to both retail and institutional users, with Fidelity reportedly having

. This step highlights Fidelity's sustained dedication to digital assets, following its previous launches of and Ethereum ETFs. A representative from Fidelity described the move as part of a "multi-year initiative to build digital asset infrastructure," aligning with established financial practices.

At the same time, market trends reveal differing attitudes among investors toward Ethereum and Solana. Ethereum experienced a $32 million accumulation by a large holder on OKX, while Solana's major holders have been distributing their assets, as

. One long-term Solana whale moved 515,000 (worth $93 million) to Binance over four months, a move analysts link to declining faith in Solana's scalability amid rising competition from Ethereum's L2s. This stands in contrast to growing institutional interest in Ethereum, as Bitget Wallet's CMO noted that corporate and whale ETH purchases are being driven by treasury inflows.

Solana's network is also rapidly advancing in treasury management and staking infrastructure. The Solana Company (NASDAQ: HSDT) has teamed up with Helius and Anchorage Digital to enhance its staking services, aiming to establish SOL as a yield-bearing asset with a 7% native staking return, as

. Meanwhile, Solmate, a prominent Solana treasury provider, saw its stock price jump 50% after revealing plans for a validator center and an ambitious M&A strategy, according to . These moves signal growing institutional trust in Solana's ability to compete with traditional finance by supporting tokenized real-world assets and cross-chain stablecoins, as mentioned in .

The convergence of Solana's expansion and the debate over Ethereum's L2s brings important questions about the future of blockchain scalability and security to the forefront. As Yakovenko and others advocate for alternatives to Ethereum's fragmented L2 environment, both ecosystems are likely to continue facing tests around decentralization, security, and economic incentives.