Current approaches to layer 2 scaling - basically, Plasma and state channels - are increasingly moving from theory to practice, but at the same time it is becoming easier to see the inherent challenges in treating these techniques as a fully fledged scaling solution for Ethereum. Ethereum was arguably successful in large part because of its very easy developer experience: you write a program, publish the program, and anyone can interact with it. Designing a state channel or Plasma application, on the other hand, relies on a lot of explicit reasoning about incentives and application-specific development complexity. State channels work well for specific use cases such as repeated payments between the same two parties and two-player games (as successfully implemented in Celer), but more generalized usage is proving challenging. Plasma, particularly Plasma Cash, can work well for payments, but generalization similarly incurs challenges: even implementing a decentralized exchange requires clients to store much more history data, and generalizing to Ethereum-style smart contracts on Plasma seems extremely difficult.
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