Layer-2 Scaling

Definition ∞ Layer-2 scaling refers to solutions built on top of an existing blockchain to improve its transaction capacity and speed. These systems process transactions off the main blockchain, then periodically settle them back to the primary layer. This approach aims to reduce congestion and lower transaction fees without compromising the security of the base layer.
Context ∞ Discussions around Layer-2 scaling are central to addressing the throughput limitations of many popular blockchains, such as Ethereum. News often covers the development and adoption of various Layer-2 solutions like rollups and state channels. The success of these technologies is seen as vital for enabling widespread use of decentralized applications and digital assets by improving user experience and cost-effectiveness.