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Layer 2 refers to protocols built on top of a blockchain (Layer 1) that help improve scalability and transaction speed without compromising security. Examples of Layer 2 solutions include Optimistic Rollups and zk-Rollups, which batch multiple transactions together and process them off-chain before finalizing on the main chain. This significantly reduces congestion, lowers transaction fees, and speeds up processing times. Layer 2 solutions are particularly important for networks like Ethereum, where high demand often leads to slow transactions and high gas fees. By offloading some transactions from the main chain, Layer 2 helps scale blockchain applications efficiently.
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