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Layer-2 Crypto Projects for 2024: The Top Picks

6 mins
Updated by Maria Petrova
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Layer-2 crypto projects have become significant contributors to the cryptocurrency ecosystem, improving layer-1 blockchains with scalability and efficiency. But what is layer-2 technology, and what do these solutions promise and deliver? Here are our top project picks for 2024.

What is layer-2 technology?

Layer-2

A layer-2 solution is an additional layer or protocol built atop an existing blockchain infrastructure (typically layer-1). The goal of L2 technology is to enhance the scalability, speed, and overall efficiency of the underlying blockchain.

L2 technology overcomes limitations in traditional blockchains like Bitcoin and Ethereum, enhancing accessibility for everyday applications and improving DApp performance. L2 solutions alleviate network congestion and reduce transaction costs on the L1 blockchain by facilitating a large volume of transactions through off-chain or more streamlined processes.

What layer-2 projects should you know about in 2024?

L2 cryptocurrencies have made significant progress in recent years, revolutionizing the ecosystem. Their popularity has soared due to Ethereum’s high gas fees and slow transaction speeds. Let’s take a look at the most promising L2 crypto projects in 2024.

1. Polygon (MATIC)

polygon bearish

Polygon is a prominent layer-2 crypto project that boasts nearly 5 million crypto users. The network features fast transactions, up to 7,000 per second (TPS). 

The project has a TVL estimated at $796 million. Additionally, it is fully compatible with the Ethereum Virtual Machine (EVM) following its recent launch of Polygon zkEVM. This integrates seamlessly into smart contracts and developer tools. 

Users can easily participate in staking through voting or as a delegate. Bridges are available to facilitate transfers from its native token (MATIC) to the ethereum blockchain. The native token takes in network governance, staking, and payment. Another exciting feature of Polygon is its adoption into the e-commerce chain, with franchises like Starbucks, Reddit, and Nike. 

Polygon’s market cap is $6.86 billion, and 93% of its tokens are circulating, totaling 9,907,383,477 tokens as of May 31, 2024.. Given the project’s heavy investments, we anticipate positive future projections.

Users can easily trade on top exchanges, including Binance, Poloniex, Huobi Global, and Digifinex. 

2. Immutable X

Immutable X is an Ethereum L2 network built to offer speed, scale, and flexibility through its simple end-to-end web3 solutions. It consists of a solid network with tools and infrastructure for creating the next generation of crypto gaming.

It features countless features that enable users to build an NFT project easily. Users can leverage Ethereum’s security, zero gas fees, and user-friendly APIs. Additionally, users can explore the immersive marketplace to trade and collect in the Immutable marketplace while viewing new and exciting projects.

“Immutable is transforming the video game industry. Never have players had the opportunity to be more autonomous, more economical and more permission less in this space thanks to play-and-earn, in-game NFTs.”

Robbie Ferguson, president of Immutable

What technology does the layer-2 crypto project use? 

The project uses a zk-Rollup technology that focuses on NFT projects. It combines logic with NFT-specific exchanges. Hence, users can enjoy a positive experience in addition to a high amount of scalability with added security.

Moreover, it features the API abstraction layer that revolves around the scaling engine while allowing developers to interact with smart contracts. 

The project has a total supply of 2 billion. Additionally, users can earn IMX tokens through trading NFTs, earning points, or receiving rewards through daily reward pools.

3. Shiba Inu

Shiba Inu (SHIB) Movement

Shiba Inu transitioned from a meme into a legitimate DeFi ecosystem through its Shibarium L2 crypto project. The best part about the Shiba Inu ecosystem is the availability of in-demand DApps, including an NFT collection, Shib the Metaverse, and ShibaSwap DEX. 

Currently, it features a strong user base with over 10 million holders. It is backed by an active community rising as one of the best top L2 networks. 

How does the layer-2 crypto project work? 

The L2 project is built on a consensus mechanism known as the Delegated proof-of-stake (PoS). The network’s infrastructure depends on the user’s participation as a voter or delegator in the ecosystem. Delegators can take over running nodes, resulting in faster transactions and processing while creating new blocks. This ensures overall security within the ecosystem.

4. Mantle

Mantle is the first modular L2 solution primarily focused on mass adoption and decentralized governance. It has a native token, MNT, for voting on the network around all decisions for new initiatives.

Additionally, it features a modular structure that caters to different transactions and actions across different layers operated by the network participants through Ethereum rollups. 

Through the rollups, it takes both computation and stage storage off-chain. This allows for a low computational load sent and processed on L1. Additionally, its TVL is at $36.78M.

By 2024, reflecting on its launch back in July 2023, the project had managed to amass a total market cap valued at $1.3 billion, with 52% of its tokens in circulation. Additionally, its TVL is at $36.78M. The future looks bright for the project, with a treasury valued at $2 billion with projections to fund future ecosystem development. 

5. Loopring

Loopring is a scalable L2 blockchain dating back to 2017. The platform’s main intent is to provide low and secure transactions. The project can process up to 2,025 transactions per second. The high scalability network is drawn from the incorporation of zkRollups. LRC is its native token used to incentivize behavior with numerous benefits to the ecosystem. As of May 31, 2024, Loopring has a market cap of $371.81 million.

Additionally, the blockchain features a native app with an automated market maker (AMM), payment platform, and order book exchange. The order book exchange facilitates low trading costs and high performance. 

Hence, users can easily trade at affordable rates and at speed without contending with high gas fees and congestion. Moreover, it acts as a custodian of assets. Apart from a decentralized exchange, it doubles up as a payment solution. Users can send ERC-20 tokens and ETH to any Ethereum address with a cheap, fast, and secure L2 protocol. 

6. dYdX

dydx

dYdx is a decentralized exchange shifting from the main ethereum chain to an L2 scaling solution, with a primary focus on perpetual derivatives trading. The L2 blockchain is used for leverage trading while managing a significant user base.

Cross-margin trading at the exchange allows for more trading pairs, including ETH-USD, BTC-USD, and LINK-USD. 

What are its key features?

The DEX platform features low fees, no gas costs, lightning-fast trade, and quick withdrawals. Its native token is dYdX, used in staking protocols, governance, and providing liquidity. 

Its market cap is $305 million, with up to 156,256,174 tokens in supply. Moreover, it has a TVL of $344 million. The platform is backed by some of the top venture capitalists in the market, including Polychain, Paradigm, and Andreessen Horowitz. 

Additionally, the project launched its flagship product, the L2 trading web app, which enables users to trade any crypto derivatives for different assets, including bitcoin, dogecoin, ethereum, BNB, and many more. 

Layer-2: innovative solutions shaping the blockchain

Solutions such as Polygon, Arbitrum, Polygon, Optimism, Immutable X, and dydX are all promising layer-2 crypto projects. The growth of these layer-2s will likely shape the future of blockchain technology. These solutions are promising long-term in terms of ecosystem growth and adoption; yet, if you plan to invest in any of the native cryptos of these projects, ensure to research thoroughly and proceed with caution. Nothing in crypto is certain, and all comes with an element of risk.

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Chris Adede
Chris Adede is a versatile professional with five years of experience in content creation, IT, and project management. He has expertise in cryptocurrencies, fintech, and blockchain and has published author work with BeInCrypto, Hanshow, and NFT Monday. A project manager at Smart Prop Trader, Chris holds a number of professional qualifications and a BSC in Information Science from Moi University. Previously, Chris worked as a Digital Marketing Manager at Webnavs, where he honed his skills in...
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