Moderate
A set of solutions built on top of a public blockchain to extend its scalability and efficiency, especially for micro-transactions or actions. Examples include Plasma, TrueBit, Lightning Netw
What Are Second-Layer Solutions?
A set of solutions built on top of a public blockchain to extend its scalability and efficiency, especially for micro-transactions or actions. Layer-2 or second-layer solutions increase the throughput and transactions per second of a blockchain by creating additional blockspace or recording transactions in a more efficient manner. Examples include Plasma, TrueBit, Lightning Network and more.
Why Are Layer-2 Solutions Important?
Layer-1 solutions increase a blockchain's scalability and, therefore, its utility. Without them, blockchains often suffer from congestion, slow transaction speeds and high fees. Layer-2 solutions direct transactions away from the mainnet and towards its cheaper and faster alternatives.
What Are The Most Popular Layer-Two Solutions?
There are several popular layer-2 solutions for blockchains like Bitcoin and Ethereum.
Lightning Network
The Lightning Network is a second-layer solution for the Bitcoin blockchain. It allows for much higher transaction speeds and near-instant settlements of payments at quasi-zero costs. The Lightning Network enables users to open channels between parties, where they can send Bitcoin without settling the transaction on the mainnet. Upon closing the channel, the final state is broadcast to the Bitcoin mainnet.
Learn more about the Lightning Network in our article What Is The Lightning Network?
Optimistic Rollups
Optimistic Rollups are second-layer solutions for the Ethereum blockchain. They process transactions off-chain before publishing a compressed version of the new state of the blockchain to the mainnet. Cryptographic proofs check the accuracy of optimistic rollups. Optimistic rollups greatly reduce gas fees. The Optimism protocol uses them to scale Ethereum.
Learn more in our article How to Use Layer-2 Rollups to Avoid Gas Fees.
ZK-Rollups
Zero-knowledge rollups also reduce gas fees while improving transaction speed. They submit cryptographic proof of the veracity of unprocessed transactions without knowing the content of the transactions. This allows the mainnet to process more data and improve the utility of the blockchain.
Learn more about ZK-rollups in our article What Can Zero-Knowledge Technology Do for Scalability?
Sidechains
Sidechains are separate blockchains that process transactions faster and leverage the security of the main blockchain to secure transactions. An important sidechain layer-2 for Ethereum is the Polygon ecosystem.
