On 2 July 203, Anatoly Yakovenko, the co-founder of Solana Labs, delved into the intriguing possibility of Ethereum functioning as a Layer 2 (L2) solution for Solana. Layer 2 solutions are bridge protocols that provide one-way security, and Yakovenko believes that Ethereum could potentially offer this for Solana.

Yakovenko outlined — via a series of tweets — that in this setup, Solana asset holders on Ethereum would have finality guarantees, ensuring they could exit back to Solana even in the event of Ethereum double-spending or creating an invalid state transition.

To make this work, Yakovenko proposed a three-step process:

  1. Submit all Ethereum transactions into Solana.
  2. Submit a Simplified Payment Verification (SPV) root for the resulting state.
  3. Implement a bridge timeout that would allow a fault to be proven.

He also identified potential faults in this setup, including conflicting SPVs for the root, invalid root computation (which could be checked with Neon Labs’ Ethereum Virtual Machine), and censorship. To counteract censorship, a relayer would need to ensure that transactions posted on Solana end up in Ethereum.

Yakovenko further explained that while it would be safe to hold Solana assets on Ethereum, it would not be safe to lend them or maintain positions against them. This is due to the risk that an Ethereum fault could separate the Ethereum state on Solana from the Ethereum social consensus fork. In such a scenario, Solana users could retrieve their assets, but their representations on Ethereum would become worthless.

He also noted that central limit order books (CLOBs) would be acceptable under this setup, but Automated Market Makers (AMMs) and non-flash loan borrowing lending protocols would not be.

Yakovenko concluded his thread with an interesting observation: if Ethereum were to cause a censorship fault, the Solana state root on Ethereum would become worthless, and posted transactions could increase the gas fee indefinitely to prove that Ethereum is non-functional.

Featured Image Credit: Photo / illustration by xresch via Pixabay