Celo has officially completed the transition from layer-1 blockchain to layer-2 protocol on Ethereum on March 26, 2025. The move was announced through a post on X, in which the platform highlighted the main technical innovations.
Among these, blocks with a time of one second, transaction costs lower than a cent, and the use of USDt (USDT) and USDC (USDC) as gas stand out.
The decision to migrate to a layer-2 infrastructure was initially proposed in the summer of 2023.
Now, with the conclusion of the process, block production on the original layer-1 blockchain has been halted, allowing Celo to operate exclusively on the new network based on the OP tech stack and optimistic rollups.
This evolution aims to improve scalability, security, and compatibility with the Ethereum ecosystem.
Summary
The advantages of Celo’s transition to Layer-2 and the role of Ethereum
Optimistic rollups represent one of the main solutions for blockchain scalability. This mechanism aggregates multiple transactions outside the main chain to reduce congestion and lower fees.
The operation is based on the assumption that all transactions are valid, unless they are challenged by a fraud proof.
According to Marek Olszewski, CEO of cLabs, the developer of Celo, the migration to the new infrastructure involves significant improvements.
He explained that Celo transactions now inherit the economic security and decentralization of Ethereum, in addition to offering one-second block times and almost instant confirmations.
This integration with Optimism technology greatly simplifies the code and optimizes network security.
Olszewski highlighted how the new configuration allowed for the elimination of approximately 365,000 lines of code, reducing the attack surface and contributing to a more efficient, rapid, and secure codebase.
One of the main reasons behind the decision to migrate to an Ethereum layer-2 is the possibility of leveraging the advantages derived from the network effects of the Ethereum blockchain.
The fondatore del protocollo di rollup Interstate, Irfan Shaik, highlighted that Ethereum offers the più grande pool di liquidità nel settore.
Blockchains that suffer from liquidity fragmentation, such as alternative layer-1s, can greatly benefit from connecting directly to Ethereum’s liquidity.
Olszewski also emphasized that the transition to the OP tech stack increases synergy with the Ethereum ecosystem, improving the composability between applications and protocols.
This means that Celo developers now have facilitated access to tools, resources, and established connections within the Ethereum universe.
A crucial aspect of the transition is the maintenance of Celo’s blockchain history, which covers almost five years of activity. Everything was carried out in a trustless manner, maintaining the integrity and reliability of the network.
Implications for the token and the future of Celo
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The conversion to a layer-2 also implies important consequences for the token di Celo, which has now been transferred entirely onto the Ethereum blockchain.
This significantly improves the liquidity of the token, ensuring greater accessibility for investors and users.
According to Olszewski, this step strengthens Celo’s positioning within the Ethereum ecosystem, ensuring full compatibility from a technological, economic, and operational perspective.
With greater interoperability, developers can now more easily integrate Celo with the main DeFi protocols and dApps available on Ethereum.
In future terms, this transformation opens up new possibilities for the adoption of Celo. The greater scalability and reduced costs make it more attractive for users and companies, facilitating the use of decentralized applications based on Ethereum.
With the support of Optimism’s infrastructure and access to a broader blockchain economy, Celo could position itself as a significant hub for scalable and decentralized applications.
Conclusion
The decision to transform from a layer-1 blockchain to a layer-2 protocol on Ethereum represents a fundamental step for the future of Celo.
Thanks to optimistic rollups, greater scalability, and the reduction of transaction costs, the platform becomes a more competitive and sustainable option in the long term.
The integration with Optimism and the Ethereum ecosystem enhances security, ensures greater composability between protocols, and increases the token’s liquidity.
This transition could mark a new phase of growth for Celo, consolidating its role within decentralized finance and next-generation blockchain applications.