What is Layer 2?
Layer 2 (L2) refers to scaling solutions built on top of a base blockchain (Layer 1) that process transactions off-chain to increase speed and reduce fees while inheriting the security of the main chain.
What is Layer 2?
A Layer 2 is a secondary framework or protocol built on top of an existing blockchain (the "Layer 1" like Ethereum or Bitcoin) designed to increase transaction throughput and reduce costs while leveraging the security of the base chain.
Types of Layer 2 Solutions
- Optimistic Rollups: Assume transactions are valid by default, with a fraud-proof window (Arbitrum, Optimism, Base).
- ZK-Rollups: Use zero-knowledge proofs to verify transactions cryptographically (zkSync, Polygon zkEVM, Starknet).
- State Channels: Off-chain channels for specific parties (Lightning Network for Bitcoin).
Layer 2 vs Layer 1
L1 (Ethereum) prioritizes security and decentralization but is expensive. L2s sacrifice some decentralization for speed and cost, but settle back to L1 for finality. Typical L2 fees: $0.01-$0.10 vs $5-$50 on Ethereum mainnet.
Major Layer 2 Networks
Arbitrum, Optimism, Base (Coinbase), zkSync Era, Polygon, and Starknet are the leading Ethereum L2s, collectively holding billions in TVL.