On September 16, the blockchain platforms XYO and Movement Network made significant strides by launching their respective mainnets as independent Layer 1 (L1) blockchains. This transition marks a shift away from their previous dependencies on Ethereum, aiming to enhance efficiency and throughput for their users.
Initially, XYO operated as a sidechain while Movement Network functioned as a modular Layer 2 (L2) solution on Ethereum. Both sought to overcome the limitations posed by Ethereum’s low throughput, especially during periods of high congestion. In a move to establish their own sovereign identities, they now aim to increase their transaction capacities and functionality, better positioning themselves in an increasingly competitive market.
Sidechains like XYO are designed with their own consensus rules but remain linked to Ethereum through bridges that secure their assets. Conversely, L2 solutions like Movement leverage Ethereum’s base layer for security and trust, making them more susceptible to the whims of the Ethereum network. The reliance on Ethereum for transaction settlement can become a double-edged sword, leading to higher costs and inefficiencies during times of congestion.
Movement Network, which launched in March 2025, is known for its flexible architecture that allows for the deployment of application-specific chains. Transitioning to a Layer 1 solution is seen as a response to community feedback, as indicated by Movement Labs CEO Torab Torabi. He noted that while the platform could theoretically handle over 10,000 transactions per second (TPS), the L2 setup restricted it to around 500-600 TPS due to centralization issues. The new L1 architecture promises improved reliability and additional features like native staking and support for Move 2.0.
On the other hand, XYO began its journey in 2018 as a decentralized location verification system, quickly establishing itself as one of the first decentralized physical infrastructure networks (DePINs). The recent launch of XYO Layer One allows the platform to rise above the constraints of its earlier design, facilitating high-volume data validation and interoperability without competing for block space with general financial transactions on Ethereum.
The migration to independent blockchains for both XYO and Movement Network presents a nuanced challenge to the current trend of many projects aligning more closely with Ethereum. While some former Layer 1 projects are evolving into Layer 2 solutions to benefit from better interoperability, XYO and Movement are charting their own paths. Nonetheless, they maintain connections to Ethereum; XYO continues to utilize aspects of Ethereum’s architecture, while Movement retains its multi-chain capabilities, functioning as both an ERC-20 token on Ethereum and a native asset on its new Layer 1.
The advancements made by XYO and Movement Network signal a notable shift in the blockchain landscape, offering insights into the evolving dynamics between independent platforms and established networks like Ethereum. As these platforms embark on their journeys as sovereign Layer 1s, the effects on Ethereum’s dominance and the broader ecosystem will be closely watched by industry participants.
