What is layer-2 and layer-3 blockchain?

Layer-2 and layer-3 blockchains have several foundational differences. Layer-2 chains are more like scaling solutions, built on top of layer-1. They are meant to enhance scalability, all while improving efficiency and lowering transaction costs. Layer-3 chains, on the other hand, further extend the capabilities of layer-2 chains. They primarily focus on interoperability, privacy enhancements, and off-chain computations.

What is layer 1 and layer-2 blockchain examples?

Some of the best layer-1 blockchains or networks include Bitcoin and Ethereum. Layer-2 blockchain examples include Optimism and Arbitrum, built on top of the Ethereum network. Other layer-2 examples are Polygon, Loopring, and the payments channel Lightning Network, which is relevant to the Bitcoin ecosystem.

Is Solana layer-1 or 2?

Solana is a popular layer-1 blockchain. It is best known for its low transaction costs and high throughput. Regarding the consensus mechanism, Solana supports a hybrid of proof-of-stake (PoS) and proof-of-history (PoH).

Is Cardano a layer-2 blockchain?

No, even Cardano is a layer-1 blockchain. The idea behind Cardano is to create a sustainable and scalable ecosystem. Regarding the consensus mechanism, Cardano supports the Ouroboros proof-of-stake (PoS) algorithm.

What is a layer-2 scalability solution?

A layer-2 scalability solution is like a secondary framework of technology built on top of a layer-1 blockchain. A layer-2 scalability solution is meant to handle transactions outside of the main chain. Plus, it is also useful for lowering network fees and congestion. Some of the examples include Optimistic Rollups, zk-Rollups, and more.