Blockchain infrastructure has developed to include layer 1 and layer 2 networks. A newer growth is the emergence of so-called “layer 3” networks.
So what are layer 3 networks, and the way do they differ from layer 1 and layer 2 networks?
What’s a layer 3?
To know what layer 3 networks are, we first want to have a look at the layer 1 and layer 2 networks that they sit atop.
Layer 1 networks are the bottom layer of blockchain infrastructure, and embody blockchains corresponding to Ethereum or Bitcoin. They supply the underlying framework for a blockchain community, validating transactions and attaining consensus.
Nonetheless, layer 1 networks can face scalability bottlenecks attributable to throughput and transaction prices.
That’s the place layer 2 networks like Arbitrum, Optimism, and Blast are available in. They’re networks that stay on high of the layer 1 blockchain and deploy a wide range of scaling options to assist enhance their effectivity. These can embody bundling transactions or processing transactions off-chain.
Layer 3 networks are one of many newest developments within the blockchain house, constructing atop the established infrastructure of layer 1 and layer 2 blockchains.
Their major operate is to host decentralized purposes (dapps) in order that they will carry out at optimum ranges with out affected by the community congestion of the layers beneath it.
Layer 3s additionally give attention to scalability and effectivity, just like the layer 2s they’re constructed on high of—however layer 3s accomplish that as a way to promote interoperability, and to enhance the efficiency of advanced dapps.
Layer 2s vs layer 3s
Layer 2s (also called rollups) have been first launched as a blockchain layer on high of the layer 1 Ethereum community. They have been meant to handle the scalability points discovered on Ethereum, and for probably the most half, they’ve achieved a reasonably first rate job at it.
The place layer 2s targeted on bettering the scalability and effectivity of the chain they have been constructed on high of, layer 3s are meant to handle points in user-friendliness, effectivity and performance, and sometimes give attention to dapps as their major use case.
The meant operate of a layer 3 community is to enhance the scalability and effectivity of decentralized purposes (dapps) constructed on high of it. They sometimes solely home one dapp, enabling it to carry out at excessive speeds, with out the congestion discovered on layer 1 and layer 2 networks.
For builders, layer 3s are an surroundings wherein they will create far more superior dapps, utilizing advanced sensible contracts that may not be possible on layer 1 or 2 networks as a consequence of scalability and price restrictions. They may also be personalized for particular utility use circumstances in ways in which layer 2s can’t—as a result of they don’t have the identical constraints.
Layer 3s aren’t unique to Ethereum; different layer 1 networks corresponding to Cosmos and its IBC protocol additionally present options for creating layer 3s.
Examples of layer 3 networks
If you happen to’ve spent any time on crypto social community Farcaster, you’re in all probability acquainted with DEGEN and Degen Chain. Initially a channel on Farcaster, the Degen group launched a token on layer 2 community Base referred to as DEGEN, primarily used to tip folks on Farcaster. The token rapidly grew, and shortly after, the pseudo-anonymous staff launched its personal L3, Degen Chain.
Degen Chain was constructed utilizing Arbitrum’s Orbit layer 3 structure, however was launched on high of the Coinbase-incubated Ethereum layer 2 community Base. Its objective is to function an extremely low value surroundings for degens and builders alike to create enjoyable and user-focused purposes, based totally on hypothesis.
One other in style layer 3 is Xai—an Arbitrum layer 3 designed for gaming purposes, providing diminished charges and a degree of account abstraction not accessible on Layer 2s.
Account abstraction is essential with regards to consumer-facing dapps like video video games, as a way to clean the onboarding course of for mainstream customers and take away the difficult sequence of steps that blockchain-based merchandise usually entail.
Xai retains the core performance of Arbitrum’s Layer 2, however makes use of optimistic rollups to deal with transactions—making it cheaper and quicker than the layer it’s constructed atop.
The way forward for layer 3 networks
As layer 2s proceed to develop and increase in depend, the demand for extra subtle and scalable options is about to develop alongside them. Layer 3s create a extra versatile infrastructure for dapps, permitting for options like privateness, person friendliness (by way of account abstraction), and interoperability throughout layers.
Relating to gaming, account abstraction is essential. Complicated dapps like video video games want a extra versatile surroundings to succeed—one which retains core parts of Web3’s decentralized ethos (corresponding to gamers proudly owning their very own in-game gadgets), but in addition supplies the extra performance that’s wanted for dapps to go from “area of interest crypto merchandise” to “mainstream.”
Equally, with regard to privateness, advanced cryptographic methods wanted to create on-chain privateness develop into far more possible and price efficient to implement.
Providing real enhancements for dapps and the builders making an attempt to construct on layer 1 and layer 2 networks, layer 3s are more likely to proliferate over the approaching years alongside layer 2s, as builders begin constructing extra advanced merchandise that transcend the present limitations of layer 1 blockchain rails.
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