Layer-2 solutions address the key challenges of congestion and high cost by doing most of the work off-chain or through streamlined approaches.
Here’s a simple analogy: If Layer 1 is a busy road with traffic jams, Layer 2 is like a set of express lanes that help cars move faster without clogging up the main road. This way, more transactions can be completed quickly and cheaply.
Let’s take a look at several layer-2 projects that you should pay close attention to in 2024.
Layer-2 Crypto Projects in 2024 To Look Out For
#1 Arbitrum (ARB)
Arbitrum is an innovative L2 project that revolutionizes development on Ethereum, the most renowned layer-1 blockchain. It’s built on top of the Ethereum blockchain to make it faster and cheaper to use. It uses a technology called “optimistic rollups” to handle transactions more efficiently.
The backbone of this project is the Arbitrum Nitro Stack, which is comprised of three parts: Arbitrum Rollup, Arbitrum Orbit, and Arbitrum Anytrust, which are built by Offchain Labs. Unlike Ethereum layer 2 solutions which handle many individual transactions, Offchain Labs’ scalable Ethereum layer 2 solutions bunches the transactions up into a single transaction.
With a $1 billion market capitalization, ARB is not only the main token of the Arbitrum ecosystem but also can carry out all of the project’s functions.
#2 Polygon (MATIC)
Polygon creates faster and cheaper transactions by combining a tech known as Plasma with a proof-of-stake blockchain architecture. With a market cap of $4.9 billion and 93% of tokens in circulation, Polygon is a popular layer-2 crypto project with its native token MATIC. It offers fast transactions, up to 7,000 per second. The project’s TVL is estimated at $796 million and It is fully compatible with the Ethereum Virtual Machine (EVM) through Polygon zkEVM.
Polygon also provides developers with a range of tools to construct and link decentralized applications (DApps), making it a flexible platform within the Ethereum ecosystem.
#3 Immutable X (IMX)
Immutable is a layer 2 scaling solution that operates on top of the Ethereum network. Therefore, it provides speed, scalability, as well as the flexibility of web3 in one product.
With a heck of a lot of functions available, users can make NFT projects easily. They can make use of Ethereum’s security protocols, no gas fees, and ease of use APIs.
The project relies on zk-Rollup technology for NFT purposes with a custom feature. The process is a mix of logic and tokens with NFT-specific exchange which increases scalability and security and provides the user with a decent experience.
#4 Mantle (MNT)
Mantle is a groundbreaking L2 solution that aspires to gain wide distribution and full decentralization. it applies an MNT native token for voting on the greatest issues of the network connected with new undertakings.
Utilizing roll-up tech and stage storage to L2, the computational burden on L1 is relieved which leads to a resourceful outcome. Its Total Value Locked (TVL) currently comes in at $36.78M.
Mantle plays a crucial role in a vast ecosystem that includes different products and projects, which are all powered by the MNT token.
#5 Optimism (OP)
Optimism is among the renowned L2 projects that trigger a massive adoption of Ethereum technology by rollups. It runs in the Optimism Foundation and works as a sub-layer functioning within the Ethereum layer.
The Optimism project, the first step of which is the creation of the Super chain platform, is to address the issue of scalability. This is the simultaneous development of OP Stack chains together with L1 (op mainnet) and other L2 chains.
#6 COTI (Currency Of The Internet)
COTI is a platform that enables a digital wallet that can facilitate a huge volume of payments and makes it easy to use. COTI’s goal is to change the way digital transactions take place, creating fast, cheap, and safe settlements. COTI uses the Trustchain protocol and DAG infrastructure to help it build a payment gateway that supports decentralized payments.
The native token, COTI, is the one that makes the network function well because it is used for transactions, rewards participants, and enables decision-making. Nevertheless, proper research is very essential before making any investment decision, with price predictions for COTI coins being an important factor.
#7 dYdX
dYdx is a decentralized exchange that has been upgraded from the Ethereum platform to a Layer -2 scalability solution and is focused on the continuous trade of derivatives.
The exchange includes low transaction fees, no gas charges, fast trade times, and instant withdrawals. The native token of the platform, dYdX, is utilized for staking, governance, and providing liquidity. dYdX is in the process of moving to its blockchain, and this is good news since this move will enhance the token’s functionality with additional features.
The market cap is $305 million and it has 156 million tokens in circulation with a $344 million total value locked as well.
#8 Loopring (LRC)
L2 solution Loopring founded in 2017, aims to provide high-level security and low-cost transactions. The platform has zkRollups implemented, making it scalable enough to process over 2000 transactions per second. LRC, the native token, attracts players and has a positive impact on the whole ecosystem.
Now, the maximum supply of the token stands at $236M. The blockchain has an app and features a payment platform and order book exchange. This allows users to trade at a lower cost, eliminating the high gas fees and congestion.
Furthermore, it is a safe keeper of assets and also gives the payment solution. Users can send ERC-20 tokens and ETH to any Ethereum address with an L2 protocol that takes place safely and effectively.
Final Words
Layer-2 crypto projects such as Polygon, Arbitrum, Optimism, Immutable X, dYdX, and COTI might prove to be high-return investments. On the other hand, you must research and evaluate before investing. You should consider market trends, technological development, and public opinion.
