In the increasingly competitive mural of blockchain technology and cryptocurrencies, protocol innovation and the ability to solve the biggest issues facing the crypto community are necessary for any project that looks to accept long-term success in the ecosystem.

Recently, the emergence of layer-two technology such as Arbitrum, Optimism and a span to the Avalanche ecosystem is revolutionizing the style investors, builders and developers interact with various protocols considering each facilitates fast, depression-price transactions that improve the fundamentals of the decentralized finance (DeFi) ecosystem while also making it easier for retail-sized investors to capitalize on opportunities.

According to data from Token Final, DeFi continues to exist i of the fastest-growing sectors of the crypto economy as evidenced by increases in the total value locked (TVL) on protocols. Some of the biggest gains from last week occurred on cross-chain compatible networks and layer-two protocols that offer a lower fee environs.

Top-6 weekly gainers in total value locked. Source: Token Terminal

Ii of the superlative six projects in the listing above, Trader Joe and Pangolin, are found in the Avalanche network, which has seen significant inflows and an increment in TVL since the launch of an upgraded cantankerous-chain bridge that allows Ethereum-based tokens and applications to drift to the Avalanche ecosystem.

Total value locked on Avalanche. Source: Defi Llama

Governance features have too been a positive factor in helping spark new growth for projects as both Alchemix Finance and Rari Capital accept ongoing, or recently completed, votes designed to improve their ecosystems and increase community interest.

Related: Bitcoin is great, but real crypto innovation has moved elsewhere

Layer-ane projects and decentralized leveraged exchanges thrive

Another emerging trend shown in the data from Token Terminal is the growing strength of derivatives and options trading protocols as regulators increasingly cleft downwards on centralized exchanges that offer derivatives services and accept loose Know Your Customer and Anti-Money Laundering requirements.

Tiptop-6 weekly gainers in protocol revenue. Source: Token Terminal

Every bit shown in the chart higher up, two of the biggest gainers in terms of protocol revenue over the past week were dYdX and Hegic, a pair of protocols that offer decentralized derivatives and on-chain options trading to investors.

Global regulators accept increased their scrutiny on leveraged and derivatives trading platforms in recent months, while at the same time, established exchanges similar Coinbase have applied to offer futures trading services, indicating that this is one sector poised for continued growth as cryptocurrencies get more mainstream.

DYdX has besides benefited from the fact that it operates on a layer-two solution developed in conjunction with StarkWare, which enables cross-margined perpetual's with null gas costs and minimal trading fees.

Information shows that Ethereum-competitors such as Tezos and Cosmos have all seen an increment in acquirement over the past week, suggesting that the layer-one boxing is heating up every bit high fees on the Ethereum network continue to motivate users to explore other options.

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