Celo Transitions from a Layer-1 Chain to an Ethereum Layer-2 Protocol

Celo announced the successful transition in a March 26 X post, stating that “Celo is officially an Ethereum layer 2” protocol.

Celo, the blockchain network launched in 2020, has officially transitioned from a layer-1 chain to an Ethereum layer-2 protocol.

Announced on March 26, the successful transition was highlighted by the organization in a X post. In the post, Celo stated that it is now “officially an Ethereum layer 2” protocol, featuring one-second blocks, sub-cent transaction costs and Tether’s USDt (USDT) and USDC (USDC) as gas.

The transition was first proposed in the summer of 2023 and is now complete after block production on the old layer-1 platform halted and continued on the new network. The new platform is based on the OP technology stack and an optimistic rollups implementation.

Optimism-based architecture

Blockchain rollups are layer-2 scaling solutions designed to bundle multiple transactions off the main blockchain, reducing congestion and lowering transaction costs. Optimistic rollups owe their name to their assumption that offchain transactions are valid by default, only resorting to fraud proofs during a challenge period if discrepancies are detected on the main chain.

"Migrating to an Ethereum L2 enhances Celo’s security and scalability, while the OP Tech stack unlocks deeper composability with Ethereum-native apps and protocols. We also had the opportunity to simplify the system, arriving at a lighter, cleaner and faster codebase with 365,000 fewer lines of code — which reduces the attack surface and increases maintainability," said Marek Olszewski, CEO of Celo developer cLabs, in comments to Cointelegraph.

Highlighting the new architecture's advantages, Olszewski added that it "brings together the best of both worlds."

"It leverages Ethereum’s network effects and liquidity while enabling Celo to continue innovating and expanding the possibilities of Web3."

Irfan Shaik, founder of rollup protocol Interstate, also recognized the change as positive for the protocol, noting that Ethereum "has the greatest network effects of any chain." He further highlighted the fact that the move to the OP tech stack was completed in a trustless manner and without any downtime.

"This is a testament to the hard work and dedication of the cLabs team, and we at Interstate are excited to see what the future holds for Celo in the Ethereum ecosystem."

Olszewski also shared his enthusiasm over the transition to the OP tech stack, saying it allows for "deeper composability with Ethereum-native apps and protocols." The new system is also significantly simplified, with 365,000 fewer lines of code — decreasing attack surface and, according to him, leading to a lighter, cleaner and faster codebase.

He also highlighted that the upgrade preserved Celo’s near five-year chain history and was carried out in a trustless manner. The token was also moved to the Ethereum blockchain, which Olszewski pointed out should sensibly increase its liquidity. He explained:

“We’re excited to continue building on Ethereum as we unlock the next chapter of the Celo vision: a financially inclusive internet where everyone can participate and thrive.”

“What this means is that Celo becomes a fully-aligned Ethereum layer 2 — by architecture, by ecosystem and by mission.”