A group of developers has introduced Ethereum R1, a layer-2 (L2) scaling solution for the Ethereum network that operates independently of the Ethereum Foundation. This scaling solution does not involve a native token and is solely funded by donations without venture backing or pre-mined token allocations. The developers emphasized the importance of neutrality, decentralization, and censorship resistance in their project. They criticized existing layer-2 solutions for resembling new layer-1 networks, highlighting concerns within the Ethereum community. The introduction of Ethereum’s Dencun upgrade in March 2024 significantly reduced fees for layer-2 networks, leading to a 99% decrease in revenue on the Ethereum base layer by September. As a result, transaction costs on the Ethereum network base layer plummeted to a five-year low in April 2025. Critics argue that this setup creates incentives for layer-2 networks to grow at the expense of the base layer, while proponents view it as a feature of Ethereum’s architecture. Anurag Arjun, co-founder of Avail, praised Ethereum’s layer-2 approach for offering users a wide range of high-throughput chains to choose from, unlike monolithic blockchain protocols. This development comes amidst ongoing debates within the Ethereum community about the future of scaling solutions.