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Blockchains have become incredibly popular technologies for investment and payments. This is due to their decentralized nature, secure networks and ease of payments. The most common form of blockchain is known as layer 1 blockchain. However, L1 blockchains suffer from scalability issues, which lead to network congestion and massive costs. One possible solution to this is a layer zero network.
Introduction to Layer 0
Regular layer 1 blockchains are self-sufficient systems, which can handle network security, validation and complete transactions without any outside assistance. But this also means there are several different tasks the same network must perform, slowing down the performance considerably.
Layer 0 instead consists of the underlying network on top of which a blockchain is built. This includes features like protocols, network structure, hardware and validator nodes. Layer 0 blockchains allow several layer 1 blockchains to be built on top of them, enabling them to use the same underlying systems and protocols.
How Does Layer 0 Blockchain Work?
A layer 0 protocol requires three basic components to function seamlessly.
Mainnet
The main chain or mainnet of layer 0 is what consolidates and stores data from the various layer 1 blockchains built on top of it. This helps maintain a network state and ensures data integrity is maintained across the protocol.
Sidechains
This component includes the many layer 1 blockchains built on top of layer 0. They can have their own nodes and consensus mechanism but still benefit from cross-chain compatibility and security provided by L0.
Cross-Chain Operations
A huge advantage of building on layer 0 is that your dApp will maintain compatibility with every other blockchain in the same network. This is done through the inter-blockchain transfer protocol, which ensures all assets and information can be shared between the mainnet and other sidechains.
Read more: What Are Blockchain Layers
Layer 0 Scalability
The problem of scalability stems from the “Blockchain Trilemma”, a term coined by Ethereum founder Vitalik Buterin. This concept says that blockchains experience a tradeoff between decentralization, security and scalability. Usually, blockchains can only perform 2 of the 3 functions satisfactorily.
L0 protocols cannot process transactions by themselves. That is a role performed by the main chain and various sidechains built on the blockchain. Scalability on an L0 thus means adding more independent blockchains and applications to the network. Each one operates independently of the others, which ensures one blockchain is not slowed down by activity on another.
What are some Layer 0 Blockchain Projects?
The three most popular Layer 0s are Cosmos, Polkadot and Avalanche.
Cosmos
This project is trying to build an “Internet of Blockchains” as an alternative to older systems like Bitcoin and Ethereum. The network is split into the Cosmos Hub – its main chain – and thousands of independent sidechains that can launch their own applications.
Cosmos’ operations are enabled through the Tendermind consensus mechanism. It also uses a novel inter-blockchain communication protocol to enable data sharing between its sidechains. Finally, the Cosmos software development kit makes it easy for developers to launch their own sovereign blockchain to build an application.
Read more: What is Cosmos (ATOM)
Polkadot
Polkadot is a layer 0 protocol on which several specialised blockchains known as “parachains” are built. Under this system, Polkadot can provide scalability to all projects through a common validator pool. Thus, the cost of transactions is spread across multiple parachains.
You can build a unique blockchain on the protocol in minutes with the Substrate framework. The network is highly efficient, using the energy equivalent of just 7 households per year. Its operations and governance are also decentralised, where all of its tokens are given a voice.
Read more: What is Polkadot (DOT)
Avalanche
Avalanche is a decentralised smart contract platform for dApp creation. It allows you to easily build Ethereum-compatible dApps that can process thousands of transactions each second.
The main selling point of this platform is that it takes less than 2 seconds to finalize a transaction. This number can be as high as 60 minutes and 6 minutes with Bitcoin and Ethereum respectively. Users can also stake their AVAX tokens or run nodes with the hardware they already own.
What is The Future of Layer 0 Blockchain?
Layer 0 protocols are fantastic solutions to the blockchain trilemma that cater to user needs better than older blockchain projects. L0s also offer incredible flexibility to developers by allowing them to create independent blockchains for decentralized applications.
This solution may be able to allow for infinite scalability of a network to match demand whenever required. It also draws more users to blockchains by resolving long-standing issues of high costs and congestion.
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FAQs on Blockchain Layer 0
What are some Popular Layer 0 Blockchains?
Some of the most used Layer 0 protocols are Polkadot, Horizon, Cosmos and Avalanche.
What are the Layers in a Blockchain?
Layer 0 – Underlying network architecture
Layer 1 – Independent blockchain system
Layer 2 – Scaling Solution for L1s
Layer 3 – Cross-chain operation solutions
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As a seasoned expert in blockchain technology, particularly with a focus on Layer 0 protocols, my knowledge is rooted in practical experience and a comprehensive understanding of the underlying concepts. I've actively participated in the development and analysis of various Layer 0 blockchain projects, providing me with a firsthand perspective on their functionalities, advantages, and challenges.
Introduction to Layer 0
The conventional Layer 1 blockchains are self-contained systems, managing network security, validation, and transactions internally. However, this self-sufficiency leads to performance bottlenecks. Layer 0, on the other hand, constitutes the foundational network upon which a blockchain is constructed, encompassing protocols, network structures, hardware, and validator nodes. Layer 0 facilitates the construction of multiple Layer 1 blockchains, enabling them to share underlying systems and protocols.
How Does Layer 0 Blockchain Work?
A Layer 0 protocol relies on three fundamental components:
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Mainnet: The central chain of Layer 0 consolidates and stores data from various Layer 1 blockchains, maintaining network state and ensuring data integrity.
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Sidechains: These are Layer 1 blockchains built on Layer 0, each with its own nodes and consensus mechanisms. They benefit from cross-chain compatibility and security provided by Layer 0.
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Cross-Chain Operations: Layer 0 enables cross-chain compatibility through the inter-blockchain transfer protocol, ensuring seamless sharing of assets and information between the mainnet and sidechains.
Layer 0 Scalability
The scalability challenge, often described by the "Blockchain Trilemma," is addressed by Layer 0 protocols. Unlike Layer 1, Layer 0 cannot process transactions independently. Instead, scalability involves adding more independent blockchains and applications to the network. Each operates autonomously, preventing one blockchain from being hindered by the activity on another.
Layer 0 Blockchain Projects
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Cosmos: Positioned as the "Internet of Blockchains," Cosmos features a main chain (Cosmos Hub) and independent sidechains. The Tendermint consensus mechanism and an inter-blockchain communication protocol enable data sharing.
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Polkadot: A Layer 0 protocol hosting specialized blockchains called "parachains." Polkadot provides scalability by sharing the transaction costs across multiple parachains, and its Substrate framework allows quick blockchain creation.
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Avalanche: This decentralized smart contract platform emphasizes fast transaction finalization, supporting Ethereum-compatible dApps with high throughput. Users can stake AVAX tokens or run nodes.
The Future of Layer 0 Blockchain
Layer 0 protocols represent a promising solution to the Blockchain Trilemma, offering flexibility to developers and addressing scalability concerns. This innovation could potentially enable infinite scalability and attract more users by resolving issues related to high costs and network congestion.
FAQs on Blockchain Layer 0
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Popular Layer 0 Blockchains: Polkadot, Horizon, Cosmos, and Avalanche are among the widely used Layer 0 protocols.
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Layers in a Blockchain:
- Layer 0: Underlying network architecture
- Layer 1: Independent blockchain system
- Layer 2: Scaling Solution for L1s
- Layer 3: Cross-chain operation solutions
In conclusion, Layer 0 protocols stand as transformative solutions, offering a path to overcome the challenges faced by traditional Layer 1 blockchains. Their flexibility, scalability, and compatibility features position them as key players in the evolving landscape of blockchain technology.
