Bitcoin Layer 2s

What are Bitcoin Layer 2s?

Bitcoin Layer 2s (L2s) are solutions built on top of the Bitcoin blockchain to:

• Enhance scalability and composability.
• Introduce features that extend Bitcoin’s functionality beyond its native capabilities.

How Do Bitcoin Layer 2s Work?

• Independent blockchains: L2s operate as separate execution layers while leveraging Bitcoin’s base layer for settlement.
• Transaction processing: L2s compute transactions and submit the details to Bitcoin’s main layer for consensus.
• Gas token usage: Many L2s use BTC as their gas token, maintaining close integration with the Bitcoin ecosystem.

What do Bitcoin Layer 2s Offer?

• Enhanced scalability: Increased transaction throughput compared to the main Bitcoin blockchain.
• Smart contract capabilities: L2s introduce programmability, enabling features like DeFi and dApps on Bitcoin.
• Inheriting Bitcoin’s security: By using Bitcoin for settlement, L2s benefit from its robust security model.