We have compiled this Layer 2 Blockchain list just for you, and we will keep adding more discovered layer 2s to this list. Therefore, you can bookmark this page for easy access.
In the context of blockchain technology, “layer 2” refers to protocols or technologies that are built on top of a blockchain (the “layer 1” technology) in order to provide additional functionality or scalability.
These layer 2 solutions are designed to address some of the limitations of the underlying blockchain, such as low transaction throughput or high transaction fees, and can be implemented without modifying the underlying blockchain.
Examples of layer 2 solutions include payment channels, sidechains, and plasma.
The Layer 2 Blockchain List
1. Parastate
ParaState aims to bridge the application and developer ecosystem between Polkadot and Ethereum for Substrated-based blockchains, such as Polkadot parachains and other chains that want to provide Ethereum compatibilities, by extending the frontier of Ethereum with the Substrate framework.
By supporting 20+ programming languages to create Ethereum-compatible smart contracts, ParaState unites a larger developer community to boost cross-chain interoperability.
While supporting the EVM pallet to provide seamless compatibility with all existing Ethereum applications, ParaState also provides developers with a next-gen smart contract implementation environment, eWASM (Ethereum-flavored WebAssembly) through its eWASM VM (Pallet SSVM) to make any smart contract Ethereum compatible, a key objective of the Ethereum Foundation roadmap fulfilled in advance by the ParaState internal development team.
These two infrastructures are ensured to talk to each other and share the same account system on ParaState. This is the differentiation ParaState provides to the developer community, to enable them to surf in the highly optimized industrial standard infrastructure while exploring brand new possibilities at the Ethereum frontier.
ParaState has officially launched the public testnet, Plato, currently running as a standalone Substrate blockchain. The platform is prioritizing and emphasizing fast execution and delivery of novel research on production while committing to radical transparency and open-source values on its development journey.
Compared to Ethereum, Polkadot is faster, safer, and more developer-friendly. Since a majority of top-tier DeFi projects are built on Ethereum, these projects require compatibility with other blockchains to benefit from improvements such as scalability and interoperability crucial to their continued growth and competitiveness in the space.
That’s where ParaState comes in.
We’re optimistic about the future of ParaState, and here are just a few reasons why:
- Any Ethereum developer will be able to write dApps on Substrate Polkadot using ParaState — appealing to a huge development community.
- Backward compatibility with existing Ethereum applications allows established projects to benefit from Polkadot’s platform.
- ParaState is a recipient of the Web3 Foundation grant and was one of 21 projects selected for the 2021 Berkeley Blockchain Xcelerator Cohort.
- With a next-gen VM infra, it future-proofs high-performing Ethereum compatibilities by bringing Ethereum protocol support to the Polkadot Substrate ecosystem.
To see how easy it is to swap your ETH for PETH (ERC-20 token on ParaState), check out their tutorial and try it out yourself!
2. Bitcoin Lightning Network
The Bitcoin Lightning Network is a decentralized network that sits on top of the Bitcoin blockchain, allowing for the creation of payment channels between participating nodes. This allows for faster and more efficient transactions, as well as lower fees because the majority of the transactions can be conducted off-chain and only the final settlement is recorded on the blockchain.
This can help to alleviate some of the scalability issues that the Bitcoin network has faced, as it allows for a higher transaction throughput. The Lightning Network is still a relatively new technology, and it is still being developed and improved upon.
3. Polygon
Polygon (previously Matic Network) is the first well-structured, easy-to-use platform for Ethereum scaling and infrastructure development. Its core component is Polygon SDK, a modular, flexible framework that supports building multiple types of applications.
Using Polygon, one can create optimistic rollup chains, ZK rollup chains, stand-alone chains, or any other kind of infra required by the developer.
Polygon effectively transforms Ethereum into a full-fledged multi-chain system (aka Internet of Blockchains). This multi-chain system is akin to other ones such as Polkadot, Cosmos, Avalanche, etc. with the advantages of Ethereum’s security, vibrant ecosystem, and openness.
The $MATIC token will continue to exist and will play an increasingly important role, in securing the system and enabling governance.
Polygon (formerly Matic Network) is a Layer 2 scaling solution backed by Binance and Coinbase. The project seeks to stimulate the mass adoption of cryptocurrencies by resolving the problems of scalability on many blockchains.
Polygon combines the Plasma Framework and the proof-of-stake blockchain architecture. The Plasma framework used by Polygon as proposed by the co-founder of Ethereum, Vitalik Buterin, allows for the easy execution of scalable and autonomous smart contracts.
Nothing will change for the existing ecosystem built on the Plasma-POS chain. With Polygon, new features are being built around the existing proven technology to expand the ability to cater to diverse needs from the developer ecosystem. Polygon will continue to develop the core technology so that it can scale to a larger ecosystem.
Polygon boasts of up to 65,000 transactions per second on a single side chain, along with a respectable block confirmation time of fewer than two seconds. The framework also allows for the creation of globally available decentralized financial applications on a single foundational blockchain.
The Plasma framework gives Polygon the potential of housing an unlimited number of decentralized applications on its infrastructure without experiencing the normal drawbacks common on proof-of-work blockchains. So far, Polygon has attracted more than 50 DApps to its PoS-secured Ethereum sidechain.
MATIC, the native token of Polygon, is an ERC-20 token running on the Ethereum blockchain. The tokens are used for payment services on Polygon and as a settlement currency between users who operate within the Polygon ecosystem. The transaction fees on Polygon sidechains are also paid in MATIC tokens.
4. Arbitrium
A layer 2 solution called Arbitrum is intended to enhance Ethereum smart contracts’ functionality by increasing their speed and scalability and, in addition, by introducing more privacy features.
The platform is intended to let programmers take use of Ethereum’s top-notch layer 1 security while running unaltered Ethereum Virtual Machine (EVM) contracts and transactions on a second layer.
It is designed to solve some of the drawbacks of existing Ethereum-based smart contracts, namely their low efficiency and high execution costs, which have harmed the Ethereum user experience and frequently make transacting costly.
The Ethereum main chain is used by Arbitrum to record batches of submitted transactions, which are then executed on a cheap, scalable layer 2 sidechain. This process is known as transaction rollups.
5. Cartesi
Cartesi or The Blockchain OS was founded to bridge the best of two worlds: intense computational jobs as we know in the world today, with the independency of central authorities or middlemen, as seen in the decentralized world of tomorrow. Create a new world with us.
With a decentralized OS, not one company controls the features, upgrades, and rules. Everyone can have a say. When it comes to proposing new features, gathering community feedback, and documenting design decisions, the Cartesi Foundation intends to use a Cartesi Improvement Proposal (CIP).
It is a formalized design document for the Cartesi community. It gives information or describes a new feature of the Cartesi network, its processes, or the ecosystem in a concise and technically sufficient way for the Cartesi community to understand.
This CIP process allows mainstream developers the flexibility to help shape the OS they want to use, i.e. “If there’s a feature you need, propose it to the community and let’s build it together”.
6. Optimism
Optimism (OP) is a layer-two blockchain on top of Ethereum. Optimism benefits from the security of the Ethereum mainnet and helps scale the Ethereum ecosystem by using optimistic rollups. That means transactions are trustlessly recorded on Optimism but ultimately secured on Ethereum.
Optimism is one of the biggest scaling solutions for Ethereum with over $300 million in TVL. It is home to 35 protocols, the biggest being Synthetix (SNX), a derivatives exchange, Uniswap (UNI), a DEX, and Velodrome (VELO), an AMM.
Users can begin their journey on Optimism by adding the chain on their Metamask and bridging tokens like ETH to the L2. On May 31, 2022, Optimism conducted a highly anticipated airdrop of its OP token. The airdrop was so popular that it briefly slowed down the Optimism blockchain.
Optimism is led by the Optimism Foundation, a nonprofit organization dedicated to growing the Optimism ecosystem. Similar to Ethereum, Optimism aims to become a fully decentralized public good that is not profit-oriented.
Optimism is completely funded by donations and grants and pledges to produce infrastructure that promotes the growth and sustainability of public goods. In its roadmap, Optimism aims to have L1-governed fault proofs ready by 2024.