L1 Usage

Definition ∞ L1 usage refers to the activity and transaction volume occurring directly on a Layer 1 blockchain network. Layer 1 networks, such as Bitcoin or Ethereum, represent the foundational blockchain layer where transactions are processed and secured by the network’s native consensus mechanism. L1 usage metrics include transaction counts, gas fees, and the number of active addresses, all indicating the demand and congestion on the primary chain. High L1 usage often correlates with network security and fundamental value.
Context ∞ L1 usage is a critical metric frequently analyzed in crypto news to assess the health and scalability of major blockchain protocols. Periods of high L1 usage can lead to increased transaction fees and slower processing times, prompting discussions about network upgrades and Layer 2 scaling solutions. The ongoing challenge for many Layer 1 blockchains is to manage increasing demand while maintaining decentralization and security.