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Blockchain Layers ELI5: What Is Layer 0, 1, 2, 3 in Crypto?

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by COINS NEWS 170 Views

Blockchain layers are a way to help us understand how a blockchain is built and run.

Layer 0 blockchains are those that allow the exchange of data between other separate blockchains, or allow blockchains to be built on top of them to take advantage of their scalability. Polkadot is a popular layer 0 blockchain.

Layer 1 blockchains are a foundational layer that is responsible for validating transactions sent across its network. Bitcoin and Ethereum are the most popular layer 1 cryptocurrency.

Layer 2 solutions are a solution to layer 1’s scalability problem. They wrap a bunch of transactions into one and send that to the main chain, which improves speed and reduces costs for the users. Polygon, Loopring, and the Bitcoin Lightning Network are popular layer 2 solutions.

Layer 3 is the application layer. This is the layer that the end user will see and interact with. The applications built on this layer can be anything from dApps, to DeFi, to play to earn games. Popular L3 cryptos are Uniswap, Aave, and Decentraland.


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