L1 Competition

Definition ∞ L1 competition refers to the rivalry among various foundational blockchain networks, known as Layer 1 protocols, to attract users, developers, and capital. These networks compete based on factors such as transaction speed, cost, security, decentralization, and developer tooling. Each Layer 1 chain aims to establish itself as the dominant platform for decentralized applications and digital assets. This competition drives innovation across the entire crypto ecosystem.
Context ∞ L1 competition is a constant theme in cryptocurrency news, with new protocols continually emerging and existing ones upgrading to improve their offerings. The success of a Layer 1 blockchain directly influences the broader market and the development of its ecosystem. Reports frequently compare different chains’ technical advancements and market share, highlighting shifts in platform preference.