What?
- Ethereum scaling solutions
- Separate blockchain
- Extends Ethereum
- Inherits the security guarantees of Ethereum
- All user transactions on the Layer 2 can ultimately settle back to Layer 1
- Ethereum also functions as a data availability layer for Layer 2s
- Layer 2 will post their transactions data onto Ethereum
- Rely on Ethereum for data availability
- Used to get the state of Layer 2
- Dispute transaction of Layer 2
Why?
Blockchain has 3 desirable properties
- Decentralized
- Secure
- Scalable
"can only achieve 2 out of 3" - Blockchain trilemma
High demand -> Need to scale without sacrificing decentralization and security => Need Layer 2 to scale Blockchain that takes advantage of robust decentralized security of Layer 1
How?
- Communicate with Layer 1 by submitting bundles of transactions
- Layer 1 handles security, data availability, and decentralization
- Layer 2 handles scaling by computing and sending finalized proofs to Layer 1 -> Remove transaction loading.
Rollup
- Preferred layer 2 scaling solution in Ethereum
- Reduce gas fees by up to 100x compared to Layer 1
- Rollup bundle ("roll up") hundreds of transactions into a Layer 1 transaction => Fee will be dived/distributed to all users (owners of these hundreds of transactions) -> Cheaper
- For example:
- 1 Layer 1 transaction is paid for 1eth as fees
- 100 Layer 2 transactions rolled up in 1 Layer 1 transaction are also paid for 1eth. So 1 Layer 2 transaction is just only needed 0.01 eth to execute.
- For example:
- Rollup is executed outside Layer 1 (in Layer 2), but finalized result (proof) is submitted to Layer 1 => and can be secured by Layer 1 security mechanisms.
- Have 2 approaches (different on posting transaction data to L1):
- Optimistic
- ZK Rollups aka Zero-knowledge Rollups
Example
- Arbitrum One
- Optimism
- Boba Network
