Layer 1 vs Layer 2 refer to two types of blockchain solutions. Layer 1 is the base blockchain protocol, such as Bitcoin or Ethereum, responsible for processing transactions and maintaining security. Layer 2, on the other hand, is built on top of Layer 1 to enhance scalability and reduce transaction costs. Layer 2 solutions like the Lightning Network or Optimistic Rollups improve throughput and transaction speed, enabling faster and more cost-efficient operations while still relying on Layer 1 for security.
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