2026 Layer1 Final Prediction: Fragmentation Worsens, Interoperability Becomes the Only Lifeline

2025 Year Layer1 Market Thorough Split: Solana and BNB Chain Rely on Meme Coin Speculation to Attract Funds, Ethereum Transforms into Settlement Layer, $90 Billion Stablecoin Net Issuance Spurs Dedicated “Stable Chains”, Zcash Surges 661% Due to Privacy Demand. In 2026, Layer1 Accelerates Differentiation into Speculation Chains, Settlement Chains, Stable Chains, Privacy Chains, and Performance Chains, with Interoperability Becoming the Only Solution for Seamless Experience.

The Three Major Camps of Layer1: Speculation, Settlement, and Professionalization

(Source: The Block)

In 2025, retail demand for Layer1 tokens is mainly driven by speculation, with the Meme coin supercycle vividly reflecting this theme. Solana and BNB Chain, thanks to high throughput, ample liquidity, and low transaction fees, become ideal venues for speculative trading flows. Solana dominated L1 DEX trading volume for most of 2025, only briefly surpassed by BNB Chain in June and Ethereum in August.

In January, Solana DEX trading volume hit a record high, but official $TRUMP and $MELANIA Meme coins accounted for nearly half of the trading volume. Even more astonishing, Pump.fun, a launch platform, contributed about 23% of Solana’s application revenue from the start of the year, solidifying its “casino chain” image. As Meme coin momentum wanes, Solana’s DEX dominance is split between Ethereum and BNB Chain, highlighting its over-reliance on a few catalysts.

BNB Chain’s revival combines technical upgrades with cultural momentum. Lorentz and Maxwell hard forks reduced block time from 3 seconds to 0.75 seconds, significantly boosting burst load capacity. CZ’s presidential pardon and the announcement of the “BNB meme season” directed speculation energy toward four.meme, which contributed about 21.8% of BNB Chain’s application revenue from the start of the year. More critically, BNB Chain processes over 138 million stablecoin transactions per month on average (adjusted data), with the “zero-fee carnival” and USD1 stablecoin from World Liberty Financial making it a hybrid ecosystem for speculation and payments.

Ethereum is heading in a completely different direction. Despite DEX trading volume reaching a record high, more daily activity occurs on Layer 2, with Base alone handling over 3.3 billion transactions this year, compared to only 473 million on the mainnet. Pectra’s hard fork further reinforces a Rollup-centric roadmap, with average mainnet transaction fees dropping from $7.25 to $0.19 (the lowest since early 2020), confirming its role as a settlement and data availability layer. Ethereum no longer competes with Solana for daily transactions but has become the cornerstone of the L2 ecosystem.

$90 Billion Stablecoin Reshapes Layer1 Landscape

(Source: The Block)

Stablecoins are one of the biggest themes in 2025. Over $90 billion in net new issuance increased the total market cap by about 45%, accelerating by $18 billion compared to 2024. This growth aligns closely with Meme coins, perpetual futures, institutional adoption, and prediction markets, leading to the emergence of “Stable Chains” optimized specifically for stablecoins.

Solana and Hyperliquid are the biggest percentage gain beneficiaries. Solana’s stablecoin supply doubled within 23 days at the start of the year, driven by about $4.5 billion new USDC minting, with an increase of approximately 159% from the beginning of the year. Hyperliquid saw record perpetual trading volume in the second half of the year, with stablecoin base growth around 118%, directly linked to liquidity and derivatives trading.

Three Layer1 Models Driven by Stablecoins

Speculation: Solana and BNB Chain use stablecoins as liquidity sources for Meme coin trading, with PYUSD reaching 7% market share on Solana.

Institutional: Aptos and Polygon grew by 142% and 76% respectively, with $500 million BUIDL deployments in October accounting for 57% and 40% of net growth.

Dedicated: “Stable chains” like Plasma, Stable, Arc, and Tempo promise protocol-level compliance and native foreign exchange trading.

Stable chains represent a paradigm shift in Layer1 design. They do not pursue broad functionality but focus on optimizing specific high-value scenarios. Plasma, launched less than three months ago, became the eighth-largest L1 by stablecoin supply, but active addresses and transaction volume have declined significantly from peak levels. With Stable launching in December, and Circle’s Arc and Stripe/Paradigm’s Tempo still in testnet, it is too early to judge whether stable chains can sustain growth.

Privacy Chains and Performance Chains Compete in Professionalization

(Source: The Block)

Stable chains are just part of the 2025 trend toward professionalization. Newer Layer1s are increasingly organized around clear core differentiators such as privacy, performance, or customizability, forming a more segmented landscape.

Privacy issues reached new heights in 2025. Monero faced a crisis, with Qubic’s “practical proof of work” chain once controlling over half of its hashrate, viewed as an economic attack rather than good-faith behavior. After Monero’s turbulence, Zcash unexpectedly surged, soaring about 661% year-to-date, with market cap temporarily surpassing Monero.

The key driver of Zcash’s revival is its integration with NEAR protocol’s cross-chain intent stacking. This allows users to “exit” transparent chains, transact within Zcash shielded pools, and return without leaving traces. Zcash’s shielded supply market share jumped from about 9% in January to nearly 24% in November. More importantly, Zcash demonstrates how to balance privacy and compliance: transactions are default transparent, but users can opt for full encryption and selective disclosure when needed. This design is adopted by IOHK’s Midnight Network and Digital Asset’s Canton Network, marking the rise of compliant privacy networks.

Performance-oriented Layer1s form another pillar of professionalization. Monad’s parallel EVM execution, finally realized on the mainnet in November, despite an unfavorable initial market environment, has seen moderate on-chain activity. Fogo’s SVM architecture, Firedancer client, and curated validator set aim to achieve Web2-level latency and centralized exchange-like experience. These projects are still early-stage but collectively demonstrate the ecosystem’s ambition to narrow the performance gap between on-chain and off-chain.

Key Trends for 2026: Interoperability Will Decide Life or Death

Despite increasing relevance standards, thorough integration around a few networks remains distant. Instead, the underlying landscape will continue to fragment, with niche professional chains rising and falling. In 2026, interoperability and cross-chain communication will determine the fate of Layer1. By abstracting various L1s and seamlessly routing activity, these systems can provide a consistent and intuitive experience for mainstream applications. The future does not belong to a single “super chain,” but to interoperability protocols that make users unaware of the underlying complexity.