Layer 2 Blockchains Explained!
Previously, we talked about layer 1 blockchains.
Click on this link if you missed it.
Let’s discuss layer 2 blockchains.
What is layer 2 blockchain?
A Layer 2 solution is a secondary blockchain network, which reduces the load on the parent chain by handling part of its capabilities.
A network that processes transactions and a smart contract on the underlying blockchain that resolves any disputes and achieves consensus on the state of the layer-2 network by cementing it to an underlying blockchain.
So, let’s take an example:
Think of a blockchain as a really busy highway. There are so many cars (transactions) trying to get through. It often gets jammed, making everything slow and frustrating.
The highway is called the “Layer 1” of the blockchain.
Now, imagine if you could build a special, smaller highway on top of the busy one, where only certain cars can go. New highway helps clear the traffic on the main road by letting some cars take a different route.
The smaller, faster highway is called “Layer 2.”
Let’s say you’re using Bitcoin to buy a toy from a friend.
Normally, you’d have to wait for the transaction to get approved on the main Bitcoin highway, which can take a while.
But with Layer 2 technology, like the Lightning Network, you and your friend can use this special, faster highway. You make the transaction there, and it’s super quick and doesn’t slow down the main highway.
How Layer 2 helps us:
1. Making transactions faster.
2. Reducing the traffic (and cost) on the main blockchain highway.
So, now you know what a layer 2 blockchain is.
