Layer 2 Solutions

Layer 2 solutions are technologies built on top of a blockchain (Layer 1) like Bitcoin or Ethereum to help it process transactions faster and more cheaply. They handle many transactions off the main blockchain, then settle the final result back on it. This reduces congestion, lowers fees, and improves speed, making blockchain networks more practical for everyday use. Examples include solutions like the Lightning Network for Bitcoin and rollups for Ethereum, which effectively increase capacity without altering the core blockchain protocol.