Ethereum R1 was introduced by a group of independent Ethereum developers. This is a layer-2 (L2) scaling solution designed to help Ethereum without relying on a native token. The key features of Ethereum R1 are its reliance on donations, absence of venture funding, and lack of pre-mined tokens or governance tokens. The developers emphasize that the project is built around core principles of decentralization, credible neutrality, and censorship resistance.

In contrast to other L2 solutions that often resemble independent layer-1 (L1) blockchains with centralized governance or opaque funding, Ethereum R1 aims to avoid these issues. It provides a simple and replaceable solution that stays true to Ethereum’s original values.

This development is particularly noteworthy because it comes at a time when Ethereum’s base layer revenue has dropped by 99% in Q1 2025. The success of Ethereum R1 could influence the ongoing debates about the future of Ethereum’s scaling solutions, especially concerning the balance between L1 and L2 networks. 

Source: Token Terminal

It raises questions about whether L2 solutions will further decentralize or possibly reduce the base layer's utility and revenue, highlighting the tension between scalability, decentralization, and governance within the Ethereum ecosystem.