What is a Layer 1?

A layer 1, or L1, refers to the base or foundational blockchain network and protocol of a cryptocurrency. It handles core validations, consensus and transaction processing for a given digital asset.

Prominent blockchain L1s like Bitcoin are the heart of major cryptocurrency projects. These base blockchains power the core activities of the ecosystem, including mining or validating transactions, storing data and enabling basic asset transfers.

The layer 1 serves as the foundation on which L2s scaling solutions and decentralized applications (dApps) are built. It provides the ultimate security and decentralization guarantees for higher-level operations.

While necessary of security, the constraints of L1 blockchains often include limits on throughput, efficiency, interoperability and flexibility. Scaling solutions like Bitcoin layers exist to address those challenges with the L1 serving as a secure foundation for innovations built on top of the main blockchain. Essentially, blockchains like Bitcoin provide the ultimate security and decentralization guarantees for higher-level innovations. Without the bedrock of a robust layer 1, L2s and other scalability solutions would not have the level of assurance they currently do.

Ultimately, the base blockchain L1 establishes the security and decentralization frameworks upon which the broader ecosystem grows. It supports the burgeoning possibilities of the cryptocurrency world and enables the wider Web3 ecosystem to grow.