Why do we say that the era of enterprises building their own L1 Blockchain has arrived?

Original text: Barry, Co-CEO of Interchain Labs

Compiled by: Yuliya, PANews

Recently, payment giant Stripe has officially entered the scene, partnering with well-known crypto venture firm Paradigm to jointly create an L1 blockchain named "Tempo." This is a "high-performance, payment-focused blockchain" designed to serve the customer base of fintech giants.

Stripe's entry is not an isolated case; it may be revealing the beginning of a huge trend—the wave of enterprises building their own L1 blockchains is quietly rising. Why, after years of silence in enterprise blockchain, have large companies rekindled their interest in building their own blockchains, and why is L1 their first choice? Below is the original text, which has been compiled by PANews.

This is not a one-time case, but rather the beginning of a huge trend of enterprises building their own L1 blockchain. Currently, many companies (including some Fortune 500 companies) are considering launching their own L1 blockchains.

Years ago, enterprise-level blockchain faced failures and became a sensitive topic for a long time. So, why are mature enterprises now starting to rebuild blockchain? And why is L1 blockchain the first choice?

The reasons for the return of enterprise blockchain mainly include two points:

1. Maturity of Stablecoins

The financial team currently communicating with it is no longer unfamiliar or fearful of stablecoins. Thanks to Circle's IPO and the upcoming regulatory policies, stablecoins are seen as a safe and highly potential technology that can help businesses reduce costs, streamline operations, and earn more from cash reserves or customer deposits. Most large companies are building infrastructure to hold and circulate stablecoins. Countries such as the United States and Japan are actively promoting stablecoin regulation, and the overall environment is developing in a favorable direction.

2. Focus on payment, not traceability

In the previous enterprise blockchain boom, most application scenarios focused on traceability (i.e., tracking the origins and lifecycle of a cross-company process, such as supply chain raw material tracking or tracking the use of charitable funds). However, such scenarios can technically be fully implemented through databases; the only issue is trust.

Nowadays, regardless of the industry, the primary focus of companies communicating with each other is payment. Most B2B and B2C payment service providers and networks currently charge merchants and businesses high fees, with settlements taking several days and real settlement risks involved. Once cross-border or foreign exchange is involved, these issues become even more prominent. For multinational companies, especially platform-based enterprises like Airbnb, building their own blockchain-based payment solutions can save billions of dollars and provide better experiences for customers, employees, and gig workers.

As for why to choose to build L1 instead of L2 or smart contracts, there are three reasons:

1. L1 has matured and is well-known among technology decision-makers

After more than a decade of development, L1 as a technology platform has been fully understood and validated. Ethereum, Bitcoin, Solana, Sui, Aptos—almost all blockchains that non-crypto industry people can name are L1 (Base may be an exception). The Cosmos technology alone supports over 200 chains, covering various fields, with a total asset value exceeding 70 billion USD; the largest newcomer project in the past year, Hyperliquid, further solidifies this pattern. In addition, the most successful enterprise-level blockchains, such as Canton, are also L1.

In comparison, while L2 is exciting, it is still in its early stages and can be difficult to understand (imagine explaining the difference between "Stage 1" and "Stage 2 Rollup" to the CTO of a consumer goods market business, or explaining how a validation bridge works; the difficulty is evident). Decision-makers in mature enterprises are often reluctant to take risks on emerging platforms. Entering the cryptocurrency space is a significant risk in itself, so it is essential to choose the most easily understandable approach for stakeholders.

2. Reduce Platform Risk

Most companies are unwilling to bet on ETH, SOL, TIA, or other public chains, but prefer to bet only on themselves. Building L1 is the best way to achieve this goal. Large enterprises often use multiple cloud service providers to mitigate risks from AWS or Microsoft, and in their view, the risks of Ethereum or Solana are much higher than those of these traditional partners.

3. Control and Connectivity

An open and transparent L1 provides enterprises with the ability to interconnect with a broader cryptocurrency ecosystem while maintaining autonomous control over the platform. L2's interoperability with other chains (such as Solana) relies on third parties and is often constrained by fraud/zero-knowledge proof windows and Ethereum's slow finality confirmations, leading to settlement delays. L1 does not have this issue, as settlements are instant and deterministic, ensuring consistency in interoperability. This feature, combined with the ability to build a proprietary "walled garden" and implement necessary KYC/AML and application logic within it, will be highly attractive.