Matt Huang, co-founder of Paradigm and project lead at Tempo, recently took to X (formerly Twitter) to clarify key aspects of Tempo—a new blockchain designed for crypto payments. In a detailed thread, he emphasized the project's dedication to permissionlessness and explained the rationale behind choosing to build a Layer 1 (L1) chain instead of a Layer 2 (L2) on Ethereum. This comes as mainstream institutions eye crypto adoption, and Huang's post highlights the importance of keeping blockchain tech open and neutral.

Tempo aims to be a fully permissionless chain right from launch. That means anyone can deploy tokens or transact without needing approval. Huang pushes back against the idea that attracting real-world users and institutions requires sacrificing neutrality at the base layer—the foundational level of the blockchain where core rules are set. Instead, Tempo will support permissionless validation, smart contract deployment, and usage, much like established networks such as Bitcoin, Ethereum, and Solana.

To kick things off, Tempo will use a permissioned validator set—a group of approved nodes that verify transactions—for stability, with plans to decentralize further over time. Validators are crucial in blockchains; they confirm transactions and maintain security. By starting permissioned and evolving to permissionless, Tempo balances quick rollout with long-term openness.

Huang stressed that features will help regulated entities, like asset issuers or money transmitters, comply with laws without compromising the chain's neutrality. This aligns with Paradigm's strong stance on permissionlessness, as outlined in their blog post The Casino on Mars, which advocates for safe regulatory harbors while preserving crypto's open nature.

As more traditional sectors adopt crypto, there's a risk they'll opt for permissioned systems—closed networks where access is controlled. Tempo's goal is to onboard them to truly open rails that handle specific payment needs efficiently.

Why L1 Over L2?

Paradigm is deeply invested in Ethereum, supporting its scaling and L2 ecosystems. L2s are secondary layers built on top of Ethereum's L1 to improve speed and cost, often using a single sequencer—a centralized component that orders transactions—for efficiency in areas like trading.

However, for global payments, Huang argues a decentralized validator set is essential. Payments involve countless partners who may not trust a central platform like Stripe or even Paradigm. A neutral, decentralized base ensures longevity and trust.

Operationally, Tempo prioritizes speed without relying on Ethereum's progress. Key features include fast finality—quick confirmation that transactions are irreversible—multiple validators for robustness, and custom transaction handling. While some could be built on L2s, it might add complexity and dependencies.

Tempo focuses on stablecoins—cryptocurrencies pegged to stable assets like the US dollar—for payments, prioritizing native issuance over Ethereum bridging.

In a reply addressing why decentralized validators are key for payments but not always for trading, Huang noted: "Most trading happens on a single exchange that users tend to trust. Bridge to L2; trade; bridge somewhere else. Real world payments are many-to-many problem with high performance requirements." This underscores payments as a complex, interconnected challenge needing broad neutrality.

Huang wrapped up by affirming he's not tied to any one chain but is a "maximalist for permissionless crypto." Tempo is about ensuring real-world payments flow on open blockchain rails.

This thread (view it here) offers a glimpse into how projects like Tempo are navigating the balance between innovation, regulation, and decentralization. For blockchain enthusiasts and meme token creators alike, it highlights how permissionless tech can drive broader adoption, potentially influencing even volatile meme ecosystems by enabling faster, cheaper transactions. Stay tuned as Tempo develops— it could reshape how we think about crypto payments.