Ethereum Layer 2 projects have been gaining traction and usage lately, due to the rising fees and transaction times on the main Ethereum network. This article explores five leading Layer 2 projects by market cap and their potential for investment.
Polygon (POL)
Polygon is a Layer 2 scaling solution designed for Ethereum scaling and infrastructure development. It is already used by many projects such as Sushiswap, Aavegotchi, Chain Games, Quickswap. Polygon offers scalable and instant transactions, reaching up to 7,000 TPS on a single sidechain in testnet. POL, previously known as MATIC, is one of the top crypto tokens with a value still under $1.
Loopring (LRC)
Loopring is a Layer 2 scaling solution for the Ethereum network, featuring a payment facility and decentralized exchange (DEX). The native token of the project is LRC. The team has developed zkRollups, used for the Loopring exchange. With Loopring Pay, users can instantly and freely send and receive Ethereum or Ethereum-based assets. The zkRollup scales Ethereum 1000x over nominal capacity by processing off-chain.
OMG Network (OMG)
OMG Network is a Plasma-based Layer 2 scaling solution for scaling the Ethereum blockchain to thousands of TPS. It reduces fees by an estimated one-third while maintaining Ethereum’s security. The project processes transactions off the main Ethereum network, using it only for final settlement. OMG Network uses batching of transactions, making the process more efficient and less resource-intensive.
Skale (SKL)
Skale is an open-source, fault-resistant security and execution Layer 2 scaling solution using sidechains to offload processing from the main Ethereum network. It is suitable for smart contracts, decentralized storage, and executing Rollups. Skale supports up to 2,000 TPS per sidechain with sub-second block times. It is fully compatible with Solidity and the Ethereum ecosystem, ensuring security with ABBA consensus algorithm.
ZKSwap (ZKS)
ZKSwap is a Layer 2 scaling solution representing an automated decentralized exchange (DEX) using zkRollup technology. Developed by L2Lab, it has launched on the Ethereum mainnet. ZKSwap moves all tokens to Layer 2, ensuring consistency with zero-knowledge proofs, allowing gas-free and unlimited scalability swaps.
The expanding Ethereum block space and the high demand for scaling create significant opportunities for Layer 2 projects. With increasing integrations and development of infrastructure, Layer 2 projects could play a crucial role in the future of the Ethereum ecosystem.
Comments