Scroll co-founder argues taxing layer-2 networks is threat to Ethereum’s values

Ye Zhang, the co-founder of Ethereum layer-2 network Scroll, has pushed back against calls for Ethereum to impose fees on layer-2 networks.

Zhang argued in a detailed social media post on April 2, that the proposal was harmful to Ethereum’s long-term vision. He called it a “toxic” approach that prioritizes short-term revenue over lasting ecosystem value.

According to Zhang, Ethereum’s strength lies not in extracting fees from rollups but in positioning ETH as the central asset across multiple Layer-2 (L2) ecosystems. He argued that taxing these networks mirrors corporate behavior and runs counter to the principles of decentralization that Ethereum stands for.

He emphasized that Ethereum’s value should not be measured by protocol income. Instead, the network should be considered an economic foundation for a growing rollup-centric ecosystem.

He noted:

“ETH’s real strength isn’t in protocol fees — it’s in becoming the hub asset across thousands of rollup ecosystems. That’s the future.”

Zhang explained that ETH’s advantage is its presence across major L2 platforms like Base, Arbitrum, Optimism, zkSync, and Scroll. Even on networks like StarkNet, that don’t use ETH for gas, he noted that the digital asset remains a key trading pair on decentralized exchanges.

Ethereum’s future

Considering this, Zhang outlined two possible directions for Ethereum. In one scenario, ETH evolves into a trusted store of value and a central hub for rollup activity.

According to Zhang:

“Every aligned L2 expands Ethereum’s surface area and social consensus. A thousand scalable rollups with ETH as the center > any monolithic chain.”

On the other hand, Ethereum could become focused on taxing L2 activity, which could drive them toward alternative data availability layers and reduce ETH’s influence in the broader blockchain landscape.

To avoid this, Zhang urged the community to focus on scaling execution and improving data availability infrastructure.

He called for a 1000x improvement in blob capacity and encouraged building out shared tools like cross-rollup liquidity bridges and interoperability solutions.

Zhang concluded:

“ETH wins by being the gravity, not the toll booth.”

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