In the world of blockchain and network technologies, continuously striving for innovation and improvement, Layer 3 (L3) solutions hold a special place. These protocols, developed based on existing L2 solutions, represent the next step in scaling and enhancing blockchain technologies. Such solutions not only expand the functional capabilities of the main blockchains but also open new horizons for optimization and efficiency in the field of digital transactions and data.
- How did Layer 3 (L3) solutions emerge?
- What is the purpose and application of these solutions?
- Examples of existing L3 solutions
How did Layer 3 (L3) solutions emerge?
The origin of Layer 3 (or L3) solutions is linked to the development and supplementation of existing second-level (L2) solutions. These third-level protocols were created to further enhance and expand the functions of the basic blockchain, similar to how L2 solutions were developed to improve the efficiency of the original blockchain.
The concept of such innovative solutions appeared more than eight years ago. The initial idea of creating multi-level blockchains was proposed by Vitalik Buterin, the founder of Ethereum, in 2015.
As of November 2023, the development and design of Layer 3 solutions are primarily focused on the Ethereum platform, where they play a key role in improving and expanding its capabilities.
What is the purpose and application of these solutions?
In the context of L3 solutions, the main focus is on two key aspects that are not always effectively implementable at the L2 level:
Aspect Description and Examples Individual Scalability L3 solutions provide opportunities for customization and adaptation of the blockchain to specific applications. Examples include performing calculations different from standard EVM, or working with various data formats. Customizable Functional Capabilities L3 provides a platform for creating specialized applications and networks with unique and precise settings. For example, it allows for the implementation of features related to the confidentiality of transactions, without disclosing data at the L2 level.
Thus, L3 can be seen as a level where unique applications or networks are deployed, closely integrated with the standards established in L2 solutions.
Examples of existing L3 solutions
Currently, the market is witnessing the emergence and development of third-level (L3) solutions, which are still in the early stages of formation. The main efforts in the development of L3 are concentrated within groups dealing with L2 solutions on the Ethereum blockchain, including teams such as Optimism, Arbitrum, and zkSync, each with its unique approach.
- Hyperchains
This is a project by Matter Labs, the company behind zkSync. They plan to create a network of blockchains interacting with each other, using zero-knowledge proof technology. For this purpose, the ZK Stack technology stack was developed, which is intended for developers and allows deploying networks known as "hyperchains", as parallel L2 solutions and third-level protocols.
In the context of Hyperchains, the Pathfinder L3 solution testnet has already been launched. It is expected that at the beginning of 2024, a hybrid cryptocurrency exchange GRVT will be released, combining elements of centralized exchanges like Robinhood with the features of non-custodial asset storage characteristic of Uniswap.
- Superchain
This is an initiative by the Optimism team, representing the concept of scaling Ethereum. Based on the OP Stack technological stack, the team's idea involves creating parallel L2 solutions that can evolve into L3 protocols in the future.
As part of the Superchain, the OP Stack accumulator client, developed by one of the leading venture crypto companies a16z, is already operational. In August 2023, Coinbase, an American exchange using the Optimism architecture, launched its second-level network named Base.
Additionally, interest in transitioning to the OP Stack architecture has emerged among other L2 solutions. For example, the company cLabs, the developer of the L2 network Celo, suggested to the community to switch to this architecture.
- Orbit
This is a project by the Offchain Labs team, responsible for the L2 solution Arbitrum. In June 2023, they released their set of tools for developers, aimed at creating L3 applications on the Arbitrum base with high customization possibilities.
On the Arbitrum platform, the L3 ecosystem already includes a multitude of projects, among which are Web3 games, financial dapps, and NFT projects, demonstrating the variety of possibilities and development directions of L3 solutions.
