Second layer solutions are becoming increasingly important within blockchains, especially among the oldest ones. These new layers make a difference in cardinal aspects such as improving scalability for Ethereum.
Layer2 solution projects are additional networks that sit on top of the main network or layer 1. Therefore, the first step to understanding this issue is to differentiate between the first and second layers. Although it may seem like a riddle language, it is actually a simple topic, as long as we do not get into the technical framework.
Bitcoin is a first layer, but its transaction capacity per second is very low. This creates slowness and bottlenecks when sending funds. To solve that problem, developers created the Lightning Network (LN), a second layer that supports more than 50 thousand transactions per second.
The original Bitcoin network is designed in such a way that it cannot be modified or updated. Meanwhile, second-layer solutions that correct malfunctions not foreseen by Satoshi Nakamoto are accepted through consensus. Thus, without modifying the network, the LN solution is on it for those who wish to use it during times of high network traffic.
The Never-Ending Issue of Ethereum Scalability
The scalability problem is an ordeal not only for Bitcoin, but also for Ethereum. Therefore, second layers become a blessing to improve scaling and its most problematic derivative, high commissions.
However, the second layers are not only intended to improve scalability. There are other issues that point to some solutions, such as security. Likewise, there are second layers that turn simple blockchains into true decentralized finance ecosystems.
Regarding the latter case, the most popular initiative is Shiba Inu’s Shibarium. This second layer, which launched in late 2023, enables the creation of Shiba smart contracts. In that sense, project developers can create their decentralized finance applications, games, and trading platforms on Shibarium.
In any case, the scalability of Ethereum was what made the so-called second layers of blockchain urgent and popular. Without exaggeration, it can be said that without these solutions, Ethereum’s chances of future success would be blurry.
The waiting time period between processing a block of transactions would be too long in a crowded environment.
Origin of the First Layers Problem
The big issue with older blockchains is improving scalability. The concept of layer 1 was born retroactively to differentiate it from the new second layer solutions. Either way, the blockchain experienced the same fate of all existing technologies, capacity.
As time progresses, technologies become incapable of fulfilling their tasks in the face of growing innovation in demand. For example, in the computer world, a 120 gigabyte hard drive was the norm back in 2004. The same can be said for the 15 gigabytes of storage on a mobile phone a decade ago.
Nowadays, at least on PCs, reference is made to terabytes. It’s hard to imagine life with a 1GB USB removable hard drive. That same reality happened with the blockchain. In the beginning, 2,000 transactions in an individual Bitcoin block were more than enough.
As for Ethereum, having better scalability than Bitcoin, no one imagined that in a few years’ adoption would collapse the network. However, this has already happened.
During traffic spikes, transactions get stuck in eternal queues, forcing merchants to pay higher fees to complete shipments.
Looking to the future, it can be said that the expansion and massification of Web3 will probably make the second layers obsolete. Consequently, 100,000 transactions per second would not be enough.
By Audy Castaneda
