Layer Two Rollup

Definition ∞ A Layer Two rollup is a scaling solution for blockchain networks that processes transactions off the main chain, or Layer One, and then batches them into a single transaction for settlement on the Layer One chain. This technology significantly increases transaction throughput and reduces fees. It operates by aggregating numerous off-chain transactions into a cryptographic proof. Rollups aim to enhance the efficiency and scalability of decentralized applications.
Context ∞ Layer Two rollups are a crucial development for the scalability of popular blockchain networks, particularly Ethereum. News often discusses the adoption and performance of various rollup types, such as optimistic rollups and zero-knowledge rollups, as they compete to offer faster and cheaper transactions. These solutions are vital for the continued growth of decentralized finance DeFi and non-fungible tokens NFTs. The ongoing evolution of rollup technology is a key area of innovation in blockchain infrastructure.