A Layer One application is a decentralized application (dApp) or protocol that operates directly on the base layer of a blockchain, such as Ethereum or Bitcoin. These applications utilize the native security, consensus mechanism, and transactional capabilities of the underlying blockchain without relying on off-chain solutions for core functionality. They directly interact with the blockchain’s mainnet, inheriting its security properties and processing transactions directly on the distributed ledger. This direct interaction means their operations are fully recorded on the foundational chain.
Context
The performance and scalability of Layer One applications are a continuous area of focus, particularly as network congestion and high transaction fees become concerns. A key debate involves optimizing the base layer protocols to support a greater volume of dApps and users without compromising decentralization. Future developments include advancements in Layer One scaling solutions, such as sharding and improved consensus algorithms, aimed at enhancing throughput and reducing operational costs for these foundational applications.
The new permissionless market module and 90% fee reduction for emerging assets fundamentally alters the Perp DEX competitive moat, prioritizing rapid asset-market fit and trader capital efficiency.
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