Layer 2 solutions are protocols built on top of Layer 1 blockchains (like Ethereum) to enhance scalability and transaction throughput. They process most transactions off-chain and then settle them in batches on the main chain.
Examples of Layer 2 technologies include Optimistic Rollups and Zero-Knowledge (ZK) Rollups. These methods compress large numbers of transactions into single proofs, significantly lowering costs and congestion on Ethereum, especially during high-traffic periods.
Layer 2s are crucial for mainstream blockchain adoption. Without them, networks like Ethereum struggle with slow speeds and high fees, making them impractical for everyday use cases such as gaming, NFTs, and microtransactions.
