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- Ethereum Reconsiders Its Rollup Future
Ethereum Reconsiders Its Rollup Future
Plus: 🥫 Prediction markets take their rivalry to New York bodegas.
Juan Aranovich
February 04, 2026
Hi! In today’s edition:
🧠 Vitalik Buterin says Ethereum’s L2 model no longer holds up
🥫 Kalshi and Polymarket bring prediction markets to NYC grocery stores
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Vitalik Rethinks Ethereum’s L2 Playbook, Calls for Shift Toward Native Rollups
Vitalik Buterin is calling time on Ethereum’s long-standing layer 2 vision. In a post on Tuesday, the Ethereum co-founder said the original idea that L2s would act as secure extensions of the main network “no longer makes sense,” arguing that many have failed to properly decentralize or inherit Ethereum’s security.
“If you create a 10,000 TPS EVM where its connection to L1 is mediated by a multisig bridge, then you are not scaling Ethereum,” Buterin wrote. In his view, too many major L2s still rely on centralized sequencers or multisig-controlled bridges, meaning users ultimately trust intermediaries rather than Ethereum itself.
The critique comes as Ethereum’s base layer has quietly improved. Gas limits are rising, fees are far lower than in prior cycles, and developers are preparing for native rollups — rollups embedded directly into Ethereum, with transaction execution verified by Ethereum validators. Combined with future zkEVM integration, Buterin sees this as a more durable path to scaling.
Rather than competing on raw throughput, Buterin argued L2s should pivot toward specialization: privacy, identity, finance, social apps, AI, or ultra-low-latency use cases. “Our job should be to make it clear to users what guarantees they have,” he said, “and to build the strongest Ethereum we can.”
The message marks a clear shift: Ethereum first, rollups second, and fewer illusions about what “inherits security” actually means.
Uneasy Money: Today at 3pm ET!
On today’s Uneasy Money, Kain Warwick, Taylor Monahan, and Luca Netz discuss Vitalik Buterin’s reframing of the L2 role, Hyperliquid’s expansion beyond perps, competing explanations for the Oct. 10 market crash, MetaMask’s move into tokenized equities, and backlash around an AI research sponsorship that was quietly walked back.
Prediction Markets Go Full Bodega Mode in NYC
The rivalry between Kalshi and Polymarket officially jumped the shark this weekend… straight into the produce aisle.
Kalshi struck first, handing out $50 worth of free groceries at a Manhattan market on Tuesday. The result: lines down the block, confused shoppers, and at least a few people discovering what a prediction market is while holding a bag of free pasta. Not bad for brand awareness.
Polymarket, clearly unwilling to lose a publicity war over frozen foods, responded by announcing something bigger and louder: a five-day pop-up it’s calling “New York’s first free grocery store.” No purchase required, no odds to bet — just vibes, shelves, and a side of civic theater. The company also tossed in a $1 million donation to the Food Bank for NYC, in case anyone thought this was only marketing.
The timing is no accident. With grocery prices still painful and Mayor Zohran Mamdani campaigning on affordability, prediction markets have apparently decided the best way to win New Yorkers over is the oldest trade in the city: free food.
Markets, but make it bodegas.
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🔐 Safe, a widely used non-custodial wallet for DAOs and institutions, grew revenue more than fivefold to over $10 million in 2025 after processing $600 billion in transactions, though the nonprofit foundation still hasn’t reached break-even profitability.
🤖 Harmonic, a math-focused AI startup co-founded by Robinhood CEO Vlad Tenev, awarded a research sponsorship to former Eclipse founder Neel Somani, who resigned from his blockchain firm in 2024 following misconduct allegations he has denied.
🕵️♂️ U.S. Treasury investigators are increasingly scrutinizing crypto exchanges and payment infrastructure for helping Iran bypass sanctions, after analytics firm TRM Labs flagged exchange-linked systems as repeat access points moving billions tied to sanctioned networks.
🧩 Aave Labs shut down its Avara umbrella brand and Family wallet to concentrate fully on decentralized lending, a move that also reignited debate with the Aave DAO over who ultimately controls the protocol’s direction.
📉 Galaxy Digital posted a roughly $482 million quarterly loss during the late-2025 crypto selloff as falling digital asset prices and weaker trading activity outweighed growth in its fast-expanding AI data-center business, sending shares down about 20% despite strong asset-management inflows.
🦊 MetaMask added access to tokenized U.S. stocks, ETFs, and commodities for eligible non-U.S. users by integrating Ondo Global Markets, letting people trade over 200 blockchain-based versions of traditional assets directly inside the wallet without a brokerage account.
📱 Crypto.com launched OG, a standalone U.S.-only prediction market app run through its regulated derivatives arm, after explosive growth in event-based trading convinced the exchange to spin the product out to compete in what it calls a multi-billion-dollar market.
💵 Y Combinator will allow startups in its Spring 2026 batch to receive funding in USDC, giving founders a faster and cheaper alternative to bank wires as the accelerator leans into blockchain payments beyond crypto-native companies.
📊 Crypto asset manager Bitwise agreed to acquire Chorus One, an institutional staking provider overseeing about $2.2 billion in locked assets, as industry consolidation accelerates and staking becomes a core yield product for large investors.
