Last time, the blog discussed the top Layer 1 blockchains, and naturally, we will now move on to discuss the top Layer 2 blockchains. Layer 2 (L2) blockchains are the next generation that takes the technology to another level. Let’s begin with a quick look at L2 blockchains.

The first thing to understand regarding L2 blockchains is that it’s not a completely different entity from L1. While L2 blockchains work independently of the main chain, it still utilizes L1 for matters such as security. L2 chains/solutions are supplementary networks that build off of L1, offering ways to attain faster and cheaper transactions, effectively tackling the scalability issue of the blockchain trilemma.

Types of Layer 2 Blockchains

Before moving on to the top L2 blockchains, let’s quickly touch on the types of L2 blockchains. There are two main types of Layer 2 chains, rollups and sidechains.

Rollups

Rollups execute transactions off-chain to avoid bottling up on Layer 1, marking the quintessential idea of L2 chains. They inherit the main chain’s security and decentralization, making it different from side chains; rollups execute transactions off-chain and are not independent. There are two types of rollups, optimistic and zero-knowledge.

Optimistic Rollups

Optimistic rollups are optimistic, duh. They assume that all L2 transactions are valid. This means anyone can challenge the transaction data where valid proof of fault will nullify the transaction. Malicious validators are then penalized for approving the faulty transaction. It’s the innocent until proven guilty concept. It should be noted that an optimistic rollup can sometimes have longer transaction time.

Zero-Knowledge Rollups

Zero-knowledge rollups are the opposite. They treat all transactions as invalid till proven otherwise by validity proofs. Validity proof will verify whether the transaction is correct without revealing any details. This is the guilty until proven innocent concept. Zero-knowledge rollups are known for their highly efficient data compression, marking high efficiency and lower costs.

Side Chains

Side chains are parallel networks that can connect to a parent blockchain, like Polygon and Ethereum, through a two-way peg. They are independent, so they will have protocols separate from the parent chain to ensure security. These chains often help enhance scalability and interoperability by establishing a system where different blockchains can work together while being independent.

Layer 2 blockchains provide methods to tackle transactions off of L1 to avoid clutter. Whether it’s a rollup or a sidechain, L2 blockchains each have unique features, but the fundamental idea of enhancing scalability or interoperability will be similar.

Top Layer 2 Blockchains

Polygon

Polygon is one of if not the biggest Layer 2 blockchains out there. It is a platform that proposes a side chain called Polygon PoS and a rollup called Polygon zkEVM. Some popular protocols on Polygon include AAVE, Quickswap, and Uniswap V3.

Polygon PoS is a sidechain that operates in parallel to Ethereum; a network that will adopt security protocols separate from the mother chain. This network aims to function alongside Ethereum to provide scalability and interoperability options. Polygon PoS offers faster and cheaper transactions for Ether by relying on around 100 PoS validators, establishing its advantage as a Layer 2 chain over the L1 giant.

Polygon zkEVM is the zero-knowledge rollup network that advances even further than Polygon PoS in enhancing scalability and interoperability. This network seeks to utilize Ethereum’s security, which Polygon PoS cannot do. Polygon zkEVM uses permissionless consensus contracts to construct a network of proposers and verifiers. The proposers propose transaction blocks, form validity proofs, and submit them back to the chain for verifiers to verify and confirm. It doesn’t require validators like Polygon PoS and focuses even more on decentralization. 

These two networks help Polygon attain transaction efficiency, making it a top Layer 2 blockchain that dwarfs Ethereum in terms of performance.

Immutable X

This next one is for all you NFT lovers out there. Immutable X is yet another Layer 2 blockchain that enhances the scalability issue of Ethereum but with a heavy focus on NFT projects and blockchain games. Immutable X centers itself around providing applications specifically for NFTs and games with a similar heavy focus on scalability, efficiency, and cost. The aim is to provide tools for developers targeting NFTs and web3 gaming. 

Immutable X is an open-source rollup protocol that offers zero gas fees and allows users to develop decentralized apps, marketplaces, and games. Utilizing StarkWare’s zero-knowledge rollup technology, this chain boasts a 9000 TPS while still being able to utilize Ethereum’s security and applications. 

With their recent announcement of partnering with gaming giant Ubisoft, Immutable X is looking to step even further into developing the web3 gaming space. This Layer 2 blockchain will constantly and consistently seek further innovation to further unique partnerships and web3 development.

Arbitrum

Founded in 2018 and introduced in 2020, Arbitrum is a suite of L2 solutions created to, once again, provide scalability and interoperability solutions for Ethereum. There are two main networks for Arbitrum- the optimistic rollup Arbitrum One which is for more general purposes, and another optimistic rollup for gaming and social applications called Aribitrum Nova. Some popular protocols on Arbitrum include Uniswap V3, Sushi, and GMX. 

Arbitrum One is the first live, permissionless Ethereum Layer 2 network with full smart contract functionality (As stated by Metamask). This network, like other L2 solutions, seeks to minimize fees and maximize storage efficiency by executing transactions off-chain while retaining Ethereum’s L1 security (As explained earlier on rollups). 

Arbitrum Nova is a newer project focusing on reducing costs through cutting data storage on Ethereum. The data storage will be split between third parties (committee members), lessening the load on Ethereum but sacrificing a little bit of decentralization as these third parties would hold more weight. Nova is designed to tackle games or dApps that require a ton of lower-value transactions, focusing more on low costs and high volume over security.

These two networks make Arbitrum the pioneer in L2 solutions while Arbitrum continues to enhance its capabilities and expanding its scope to different areas such as gaming and dApps.

ThunderCore and Layer 2 Capabilities

ThunderCore is one of the most prominent Layer 1 blockchains out there. But Thundercore is fully capable of adding Layer 2 solutions to counter them. A lot of this comes from ThunderCore’s EVM compatibility where any solution or application building off of Ethereum will be available for ThunderCore to adopt. Noting ThunderCore’s flexibility, just as the top Layer 2 builds off of Ethereum, the same could be said for others working off of ThunderCore.

ThunderCore was founded in Silicon Valley in 2017 to provide a robust infrastructure for DApps and the broader DeFi ecosystem. Its high-performance blockchain offers a breakthrough consensus protocol PaLa, 4,000+ TPS, sub-second confirmation times, and low gas fees.

With over 8 million addresses, 680 million transactions, and 133 million block height on its network, ThunderCore is dedicated to bringing blockchain technology to broad adoption. You can learn more about ThunderCore’s historical information on our Medium Blog.

What’s Next?

Now that we have an idea of the layers of blockchain as well as the top chains for each layer, we will continue diving into the different types of blockchain. It’s part of our initiative to bring information to our users and to increase general understanding of this crypto/web3/blockchain world we are trying to live in.

Next time, we will talk about public and private blockchains and their significance! Stay tuned for more Thunder Academy and future ThunderCore updates!