In the world of cryptocurrencies, Layer 1 and Layer 2 coins play a crucial role in the development and improvement of the blockchain. Layer 1 is the foundation on which all transactions are built, while Layer 2 helps improve speed and reduce costs.

What are layer 1 coins?

Layer 1 coins are the native assets of blockchains that operate independently without the need for external platforms to secure transactions. These coins have their own infrastructure, making them essential to the functioning of the crypto ecosystem. Notable layer 1 coins include:

  • Bitcoin ($BTC ): The world's first and largest digital currency by market value, it is considered "digital gold".

  • Ethereum ($ETH ): The most popular smart contract platform, which paved the way for decentralized finance (DeFi) and decentralized applications (DApps).

  • Solana ($SOL ): Known for its high speed and low fees, making it a strong competitor to Ethereum.

  • Cardano (ADA): Takes a scientific approach to blockchain development with a focus on security and sustainability.

  • Tron (TRX): Aims to provide a decentralized environment for creating and trading digital content without intermediaries.

What are layer 2 coins?

Layer 2 solutions are developed to relieve pressure on layer 1 networks by processing transactions off the main chain and then recording them later. These solutions allow for improved speed and reduced fees. Some of the most important layer 2 projects are:

  • Arbitrum: An Ethereum-oriented solution that increases transaction speed and reduces transaction costs.

  • Optimism: Provides efficient solutions for scaling the Ethereum network.

  • Polygon (MATIC): One of the most popular scaling solutions that boosts Ethereum performance and reduces fees.

  • Loopring (LRC): Based on zk-rollups technology to improve efficiency.

  • Starknet: Uses advanced clustering solutions to achieve the highest levels of security and decentralization.

Future and expectations

As blockchain technology continues to evolve, layer-1 currencies remain the foundation of the decentralized digital economy, while layer-2 plays an important role in accelerating transactions and expanding usage. Partnerships between layer-2 projects are expected to grow to improve network performance and reduce transaction costs, further promoting the wider adoption of cryptocurrencies.

🔹 Note: It is always advisable to conduct careful research before investing in any cryptocurrency, due to market volatility and the effects of global events on prices.