Layer 2 (L2)

DeFi

A Layer 2 is a secondary network or protocol built on top of a Layer 1 blockchain, designed to make transactions faster and cheaper while still inheriting the underlying security of the base chain.

A Layer 2 is a secondary network or protocol built on top of a Layer 1 blockchain, designed to make transactions faster and cheaper while still inheriting the underlying security of the base chain. Rather than processing every transaction directly on the busy and expensive Layer 1, a Layer 2 handles a large volume of activity off-chain, bundles many transactions together, and periodically submits a compressed summary back to the Layer 1 for final settlement.

The core insight is that not every single transaction needs to be immediately processed by thousands of nodes around the world. Many interactions — in gaming, trading, or social applications — can happen quickly and cheaply on a Layer 2, with the Layer 1 serving as the ultimate security backstop. This dramatically increases the number of transactions the overall ecosystem can handle, a property known as “scalability.” Popular Layer 2 networks built on Ethereum include Arbitrum, Optimism, and zkSync. Users can bridge their tokens from Ethereum’s mainnet to one of these Layer 2s, conduct many transactions at a fraction of the cost, and withdraw back to mainnet when needed.

Example: Imagine a busy bank where every transaction — every cup of coffee, every lunch — required a full bank teller and formal paperwork. That would be chaos. Instead, you use a debit card that accumulates your daily spending and settles it against your bank account at the end of the day. Your card is the Layer 2: fast and easy for daily use, but ultimately reconciled with the secure, authoritative bank (the Layer 1) in the background.

Top tokens on base

  • USDC
    USDCUSD Coin
    $1.00$876.57M
  • WETH
    WETHWrapped Ether
    $1.69K$815.09M
  • cbBTC
    cbBTCCoinbase Wrapped BTC
    $63.83K$543.97M
  • ETH
    ETHEther
    $1.69K$68.45M
  • S

    SpaceXSpaceX
    $0.041003$65.17M
  • cbETH
    cbETHCoinbase Wrapped Staked ETH
    $1.91K$26.77M
  • EURC
    EURCEURC
    $1.15$17.17M
  • wstETH
    wstETHWrapped liquid staked Ether 2.0
    $2.09K$16.77M
  • VIRTUAL
    VIRTUALVirtual Protocol
    $0.59$15.13M
  • S

    SOLSolana
    $66.93$11.84M