$ALGO is a standalone layer-1 blockchain with unique technology and a focus on speed, security, and efficiency.

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What Is Layer-1 Blockchain?

Layer-1 is the main blockchain that serves as the foundation of the network itself. Examples include Bitcoin, Ethereum, Solana, and of course Algorand. Layer-1 is responsible for:

  • Processing transactions.

  • Running smart contracts.

  • Maintaining network security and decentralization.

Why Isn't $ALGO Layer-2?

Layer-2 is a solution built on top of a layer-1 blockchain to overcome limitations such as speed or transaction costs (example: Polygon on top of Ethereum).

$ALGO does not need a layer-2 because it was designed to be an efficient blockchain from the start.

Its consensus technology, Pure Proof-of-Stake (PPoS), enables high scalability without sacrificing decentralization or security.

Algorand's advantages as a Layer-1:

1. Fast and Cheap:

Block time is only 3.6 seconds, with very low transaction fees (~$0.001).

2. Energy-Efficient Design:

One of the most environmentally friendly blockchains as it uses less energy than Proof-of-Work.

3. Smart Contracts:

Supports DeFi applications, NFTs, and asset tokenization through Algorand Smart Contracts (ASC1).

4. Finalists Instan:

Transactions that have entered the block are considered final without the risk of rollback or fork.

Layer-2 in the Algorand Ecosystem?

Although $ALGO is layer-1, its ecosystem supports the development of off-chain or layer-2 solutions for specific use cases. For example:

Algorand State Proofs: To improve interoperability between Algorand and other blockchains.

DeFi projects in the ALGO ecosystem can build additional layers to expand functionality.

$ALGO is a standalone layer-1 blockchain, but with advanced performance and design that means it doesn't need a layer-2 to compete!

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