What is the difference between "Layer 0", "Layer 1" and "Layer 2"? . What problem was created to solve layer 0? Today’s article will help you get a more detailed perspective on answering the above questions.
Blockchain structure and layer division
The multi-layer structure of the blockchain can be simply understood as:
Layer 0: Infrastructure that can build multiple layer 1 blockchains.
Layer 1: Developers use the underlying blockchain to build applications, such as decentralized applications (DApps).
Layer 2: Scaling solutions work outside of layer 1 blockchains to offload them.
If you want a deeper understanding, you can continue to learn about the structure of the blockchain with me.
Blockchain structure
You can think of blockchain as the structure of a house: first, we need to lay the foundation for the house, then start building the upper floors, then complete the rough, and finally decorate the house so that it can be put into good operation.
Similarly, the structure of the blockchain is also divided into many layers (Layer), with different functions. The blockchain logical architecture has six layers:
Data Layer (Data Layer);
Network Layer (Network Layer);
Consensus Layer;
Active layer (Incentive layer);
Contract Layer (Contract Layer); and
Application Layer (DApp Layer).
The six-layer structure of the above-mentioned blockchain system has an inseparable structure to maintain the stable operation of the blockchain. Depending on the goals and direction of the project, the blockchain may or may not contain enough of the above layers.
Layer 1 blockchains, such as Bitcoin or Ethereum, are independent blockchains that are relatively complete and can run stably without any third party. This is both an advantage and disadvantage of this type of project. The advantage is that the blockchain structure will be optimized from the start to serve the project's goals, avoiding constant customization. However, when a blockchain needs to do all the work itself, it also has drawbacks, hindering scalability. Additionally, standalone blockchains will have limitations in terms of interoperability with other blockchains.
Layer 0, also known as the "data transport layer", was created to solve the above problems of Layer 1. Layer 0 scaling solutions are solutions that do not change the blockchain structure and retain its original ecosystem rules to improve performance. The Layer 0 solution is very flexible as it does not impact the blockchain itself and is also compatible with Layer 1 and Layer 2 scaling solutions.
Learn about Layer 0
When you participate in the market and learn about blockchain, you must often hear the phrase "Triple of Impossible" of blockchain, which includes scalability, security and decentralization.
Normally, it is extremely difficult for blockchain to perfectly solve these three problems. The project will be forced to sacrifice an aspect to serve the project's development goals.
For example, Ethereum is decentralized and very secure, but in exchange the transaction processing speed and transaction costs are quite expensive, which was partially solved after the Ethereum 2.0 related updates. In contrast, Solana and Avalanche give us a Layer 1 with fast transaction processing speed and low cost, but in exchange they lack good decentralization.
Layer 0 protocols will help overcome the challenges faced by Layer 1 networks such as Ethereum. By creating a more resilient infrastructure and allowing developers to launch blockchains dedicated to their own purposes, Layer 0 hopes to more effectively address issues like scalability and interoperability.
Interactive capabilities
Increased interoperability will make the user experience “seamless” and more convenient, especially in the context of so many different Layer 1 blockchains.
Blockchain networks built on the same Layer 0 protocol can interact with each other by default without using other types of bridges. This will help improve user experience, reduce costs and avoid risks (attacks on the bridge).
Extension ability
Blockchains like Ethereum and even Solana are often crowded because a single Layer 1 protocol is providing all important functions such as transaction execution, consensus, and availability data. This creates a bottleneck in terms of scaling, which Layer 0 can alleviate by delegating these important functions to different blockchains.
This design ensures that every blockchain network built on the same Layer 0 infrastructure can optimize certain tasks, thereby enhancing scalability.
Developer flexibility
To encourage developers to build on this foundation, Layer 0 protocols often provide easy-to-use software development kits (SDKs) and seamless interfaces to ensure developers can easily and effortlessly launch a blockchain dedicated to their purpose.
Layer 0 protocols provide developers with tremendous flexibility to customize their own blockchains, allowing them to define their own token issuance models and control the types of DApps they want to build. Built on their blockchain.
Some examples of Layer 0
Active Layer 0 protocols can work in different ways. Each one can vary in design, functionality, and focus.
Generally speaking, the Layer 0 protocol acts as the main blockchain and backs up transaction data from different Layer 1 chains. While there are Layer 1 chain clusters built on Layer 0 protocols, there are also cross-chain transfer protocols that allow tokens and data to be transferred between different blockchains.
Below, my brothers and I analyzed some Layer 0 models:
Cosmos (ATOM)
The project was founded in 2014 by Ethan Buchman and Jae Kwon. Cosmos consists of a PoS blockchain mainnet and custom blockchains called zones. The main chain Cosmos Hub is used to transfer assets and data between connected regions and provides a common security layer.
Each Zone is highly customizable, allowing developers to design their own cryptocurrencies, have custom settings for block verification, and more. All Cosmos applications and services hosted in these zones interact through the Inter-Blockchain Communication (IBC) protocol. This allows assets and data to be freely exchanged on independent blockchains.
Cosmos has also successfully developed the Cosmos SDK, making it easier for projects developed on Cosmos to launch their own blockchains.
Polkadot (DOT)
Ethereum co-founder Gavin Wood designed Polkadot to allow developers to build their own blockchains.
Polkadot’s structure includes Relay Chain (which acts as a bridge between parallel chains) and Parachain (an independent blockchain built on the Polkadot main chain).
Polkadot uses a proof-of-stake (PoS) authentication mechanism to ensure network security and consensus. Projects that want to build on Polkadot participate in the auction to bid for space.
Avalanche (AVAX)
Launched by Ava Labs in 2020, Avalanche focuses on DeFi protocols and uses a triple blockchain infrastructure consisting of three core chains: contract chain (C chain), exchange chain (X chain) and platform chain (P chain) .
These three chains are specifically configured to handle critical functions in the ecosystem and are designed to increase security while striving for low latency and high throughput. X-Chain is used to create and trade assets, C-Chain is used to create smart contracts, and P-Chain is used to coordinate validators and subnets. Avalanche’s flexible structure also enables fast and cheap cross-chain exchanges.
In 2021, Avalanche launched Subnet and officially transformed into a true Layer 0. A subnet is a subnet that exists within the main Avalanche network and consists of validators operating under a common consensus mechanism to validate a set of blockchains.
in conclusion
From my personal point of view, Layer 0 will have more potential in the future and gradually become a more obvious trend. The current market demand may not require too many Layer 0 solutions, but if crypto and blockchain are more widely accepted, then a Layer 0 will definitely be needed to develop your own blockchain, and there will be more and more projects. You can continue to delve deeper into big projects in this niche to find long-term investment opportunities.
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