What is the Layer-2 network for Bitcoin?
Layer-2 networks for Bitcoin are protocols and technologies built on the main Bitcoin network (Layer-1) aimed at improving its performance, especially regarding transaction speed and reducing fees, without modifying the original network itself.
The main goal of these networks is to overcome the challenges facing Bitcoin, such as slow transactions and high costs during periods of congestion.
How do Layer-2 networks work on Bitcoin?
Layer-2 networks operate by executing some operations outside the main Bitcoin network, then only sending the final results to the main blockchain.
Some of the prominent methods used include:
State Channels: Allow sending and receiving many transactions off-chain, with only the final result being recorded.
Sidechains: Independent blockchains that connect and work with Bitcoin.
Rollups: Aggregating a large number of transactions off-chain and then summarizing them into a single transaction that is recorded on the main chain.
Benefits of Layer-2 networks on Bitcoin
๐น Significantly reduce transaction fees
๐น Faster transaction settlement
๐น Enable smart contracts and decentralized applications (dApps)
๐น Achieve scalability without sacrificing security
๐น Revitalize Bitcoin as a source of financial applications, not just as a digital asset
The best Layer-2 projects on Bitcoin for 2025
1. Lightning Network
The Lightning Network is the most famous and oldest Layer-2 project on Bitcoin. It allows users to send and receive money almost instantly and with minimal fees by creating off-chain payment channels.
โ Ideal for everyday payments and small amounts
โ Supported by wallets like Strike and Wallet of Satoshi
2. Stacks Project (Ticker: STX)
Stacks is a Layer-2 project that adds smart contracts and decentralized applications to Bitcoin, using a unique algorithm called 'Proof of Transfer'.
โ Provides an environment for building NFTs and DeFi on Bitcoin
โ Secure because it leverages the power of Bitcoin
๐ STX price link on Binance
3. Merlin Chain
Merlin Chain is a recent project focused on introducing ZK-Rollups technology to Bitcoin, which allows aggregating transactions off-chain and improving speed and privacy.
It helps in launching DeFi and NFTs applications backed by Bitcoin.
โ Advanced technology for scalability and privacy
4. Rootstock Infrastructure Framework (RIF)
The Rootstock (RSK) project is a sidechain for Bitcoin that supports EVM-compatible smart contracts (like Ethereum), making it easier for developers to migrate their applications to Bitcoin.
The RIF token is used to run services like decentralized identity and payments.
โ Running dApps on Bitcoin using Ethereum tools
๐ RIF price link on Binance
5. Nervos Network (CKB)
The Nervos Network is a public Layer-1 chain that supports Layer-2 capabilities and integrates with Bitcoin.
Allows the creation of flexible applications compatible with multiple blockchains using the CKB platform.
โ High flexibility and support for multiple networks
๐ CKB price link on Binance
Summary
Layer-2 projects on Bitcoin represent an important step towards a faster, cheaper, and more programmable future using Bitcoin.
Whether you are an investor, developer, or a regular user, understanding these projects gives you a deeper insight into Bitcoin's new future.
