L2 scalability refers to methods that increase a blockchain’s transaction capacity by processing transactions off the main chain. Layer 2 scalability solutions are protocols built on top of a base blockchain, known as Layer 1, to handle a higher volume of transactions more efficiently. These solutions process transactions externally and then periodically record a summary or proof of these transactions back onto the main chain. This approach significantly reduces congestion and transaction costs on the foundational network, making decentralized applications more practical for widespread use.
Context
L2 scalability is a paramount concern for the continued growth and mainstream adoption of blockchain technology, especially for networks like Ethereum. The current landscape involves a competitive race among various Layer 2 technologies, such as rollups and sidechains, each with distinct trade-offs in security and performance. Future developments are focused on optimizing these solutions for greater throughput, lower latency, and enhanced user experience, aiming to support global-scale decentralized applications.
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