Why Rayls Built an L1

At Rayls, our goal is to create a unified infrastructure that seamlessly connects traditional finance (TradFi) with decentralized finance (DeFi), enabling the tokenization of up to $100 trillion in assets and bringing 6 billion users onchain. We deeply respect the groundbreaking work done by projects across the blockchain space, including Ethereum's foundational L1 and the innovative L2 solutions built upon it. These technologies have driven tremendous progress in scalability, security, and accessibility. However, after a thorough evaluation of available options, we identified certain gaps that were particularly relevant to our focus on institutional-grade requirements like privacy, compliance, and deterministic performance. This led us to develop our own sovereign L1 as the most effective way to meet those needs without compromising on interoperability or future collaboration.

To illustrate this decision-making process, consider the following comparison of key features across major blockchain architectures, drawn from our analysis:

Feature	Ethereum L1	OP Rollups	ZK Rollups	Private L1s	Rayls
Deterministic finality	No	Nearly impossible	Nearly impossible	Yes	Yes
Stable gas fee model	No	Nearly impossible	Nearly impossible	Yes	Yes (USDr gas)
Censorship resistant	Yes	Yes	Yes	No	Yes (distributed validators are all trusted financial institutions, with further decentralisation in time)
EVM compatibility	Yes	Yes	Yes	Sometimes	Yes (Reth-based)
Performance (TPS)	Limited	Limited	Limited	10,000+	10,000+
Privacy	Limited	Limited	Limited	Possible	Yes (via Enygma)
Uptime	100%	100%	100%	Unknown	100% (enterprise deployments)
Compliance	Determined at smart contract layer	Determined at smart contract layer	Determined at smart contract layer	Unknown	Determined at smart contract layer
MEV Protection	No	No	No	Possible	Yes (in time)
Permissionless validators	Yes	Sometimes	Sometimes	Likely not	Yes (in time)

Ethereum's L1 provides excellent censorship resistance, permissionless validators, and a robust foundation for the ecosystem. It has enabled a thriving DeFi landscape with global accessibility. However, for institutional applications, challenges such as the lack of sub-second deterministic finality, volatile gas fees, and limited native privacy can hinder real-time settlements and confidential operations—essential for TradFi workflows like credit tokenization and cross-border payments.

L2 rollups, such as those using optimistic (OP) or zero-knowledge (ZK) approaches, build admirably on Ethereum's security while improving throughput and reducing costs in many scenarios. They inherit Ethereum's strengths and have been instrumental in scaling DeFi. Yet, achieving sub-second deterministic finality remains challenging due to reliance on L1 settlement processes, and features like stable gas fees, comprehensive privacy, and built-in MEV protection are not inherently optimized for high-stakes financial environments. These limitations could introduce unpredictability in costs and expose sensitive data, which institutions prioritize avoiding.

Private L1s offer strong performance metrics, including high TPS, fast finality, and potential privacy, making them suitable for controlled settings. We value their contributions to enterprise blockchain adoption. That said, they often lack censorship resistance and permissionless validators, which can limit global interoperability and create silos—counter to our vision of bridging TradFi's private liquidity with DeFi's open markets.

The cause-and-effect here is straightforward: While existing solutions excel in many areas, no single architecture fully aligned with our requirements for combining institutional privacy and control (e.g., via Privacy Nodes and Networks) with public DeFi accessibility, all while ensuring compliance, low risk, and scalability to 10,000+ TPS. This gap prompted us to build the Rayls L1 Public Chain, powered by our novel Rayls Byzantine Fault Tolerance (RBFT) consensus mechanism (evolving into Axyl). It achieves sub-second finality in a permissionless setting, incorporates USD-pegged gas fees for stability, and uses our Enygma protocol for privacy-preserving transactions with zero-knowledge proofs and post-quantum cryptography.

Looking ahead, we're particularly excited about Ethereum's ongoing developments in privacy and scalability, which align closely with our own innovations. Initiatives like the Ethereum Foundation's dedicated Privacy Cluster and the Kohaku roadmap for enhancing wallet privacy and security are promising steps toward confidential transactions and reduced reliance on centralized services. On the scalability front, advancements such as ZK-EVM integration and efforts to support privacy-first dApp ecosystems by 2026 could further unlock global adoption. We see great potential for collaboration and are eager to explore how these evolutions can complement Rayls' ecosystem, fostering a more inclusive and efficient financial future for all.