As developments in blockchain technology are progressing constantly, the need for the protocol’s scalability and effectiveness has remained a primary challenge. While Layer 1 and Layer 2 solutions have come a long way, Layer 3 blockchains are the next evolution in the race for scalability. These solutions are claimed to improve the efficiency and functionality of the dApps while addressing some of the limitations faced by their predecessors. In this blog, let us dive deep into what Layer 3 blockchains are, how they function, and the benefits they add to the blockchain world.
TABLE OF CONTENT
What are Layer 3 blockchain solutions?
Layer 3 blockchains are advanced forms of blockchain technology that are based on Layer 1 and Layer 2 solutions. Where Layer 1 solutions are related to the core blockchain protocols and Layer 2 solutions are focused on scalability and transaction rate enhancement by means of off-chains, Layer 3 solutions are oriented on the application layer. This means that Layer 3 blockchains are intended to augment and maximize the functionality of dApps and smart contracts.
Layer 3 solutions help in making dApp development services much more effective and manageable and also resolve problems like high gas fees, slow transaction speed, and limited interoperability. These solutions make it possible for developers to build more complex applications with a better user interface through the additional layer of infrastructure that will lead to the mass adoption of blockchain technology.
Layer 1 vs. Layer 2 vs. Layer 3 Blockchain Scaling Solutions
To understand the significance of Layer 3 solutions, it is first necessary to distinguish Layer 3 solutions from Layers 1 and 2. The table below highlights the key differences between these three layers:
| Sr. No. | Aspects | Layer 1 Solutions | Layer 2 Solutions | Layer 3 Solutions |
| 1 | Definition | The main or parent blockchain | Secondary protocols built on Layer 1 | An additional layer optimizing dApps |
| 2 | Core Focus | Base blockchain protocol | Off-chain scalability | Application layer optimization |
| 3 | Security | High | Moderate to high | High (inherits Layer 1 security) |
| 4 | Use Cases | Basic blockchain functions | Advanced transactions with more efficiency | Complex applications that can be used across multiple chains |
| 5 | Transaction Speed | Moderate | Fast | Extremely Fast |
| 6 | Development Complexity | High | Moderate | Low to moderate |
| 7 | Examples | Bitcoin, Ethereum | Arbitrum, Polygon | Orbs, Arbitrum Orbit, zkSync Hyperchains |
Key Components of Layer 3 Blockchains
Protocol Layers: These layers lay out the rules and standards of how one chain interacts with another chain. They make it possible for blockchains in different networks to work cohesively and in a secure manner.
Service Layers: This component consists of different services that are distributed across the network, such as identity, data, and storage. These services provide infrastructure to dApps by improving their efficacy through added services.
Application Layers: The bottom layer is mainly involved in the creation of operational and managerial applications, while the uppermost layer is mainly concerned with the creation of applications for the users. Consequently, developers are capable of constructing complex and more efficient dApps on top of the solid foundation of the lower layers.
Use Cases of Layer 3 Scaling Solutions
Layer 3 solutions present numerous use cases, demonstrating their versatility and potential impact on the blockchain industry:
1. Gaming: Layer 3 blockchains can support complex gaming ecosystems, offering the quick and flawless interactions required for a smooth gaming experience. Xai Network, based on Arbitrum Layer 2 with Layer 3 aspirations, is a high-performance blockchain designed for gaming. It is designed to give the developers a framework that can support the creation of fast paced games with many players.
2. Finance: In decentralized finance (DeFi), Layer 3 solutions allow for faster transactions and more efficient processing of financial instruments, which is critical for the best blockchain consulting agencies. StarkWare’s Layer 3 scaling solutions are currently adopted by DeFi applications such as dYdX and Immutable X to improve the rates of transactions and make DeFi easier and faster.
3. Supply Chain Management: Layer 3 blockchains provide robust solutions for tracking and verifying supply chain activities that, in turn, increase the level of transparency and effectiveness of the processes. For example, VeChain implements Layer 3 solutions to provide integrated solutions in the supply chain domain. Their technology makes their products trackable from the point of manufacturing to the end consumer.
4. Healthcare: These solutions can process sensitive healthcare information securely and with ease, thus increasing the ability to access information quickly while enhancing the security of information. As an example, MediBloc uses Layer 3 blockchain to protect and share health record information. It provides better data availability and protection for patients and other healthcare providers.
5. Social media: Layer 3 solutions can be utilized to enable decentralized social media applications to provide effective and secure communication without the limitations of conventional networks. Minds is a decentralized social media platform built on Layer 3 blockchain solutions that provides its users with private, censorship-free communication.
Advantages of Layer 3 Solutions
Layer 3 blockchains bring several advantages that set them apart from their predecessors:
- Enhanced Scalability: Due to its ability to decentralize the transaction load from Layer 1 and Layer 2 networks, Layer 3 solutions offer profound scalability as a means of building intricate and high-performance dApps.
- Reduced Costs: Layer 3 blockchains can drastically cut the fees on each transaction and make the cost per user and developer interaction with dApps more affordable.
- Improved Interoperability: Layer 3 solutions enable interaction between different blockchain networks, allowing dApps to access resources and functionalities from one blockchain network to another.
- Enhanced User Experience: Being faster and cheaper, Layer 3 solutions define a more user-friendly environment that generates broader adoption for decentralized applications.
- Customization: Since Layer 3 protocols are specific to developers, they can be optimized for applications as required.
Examples of Layer 3s
Several projects are pioneering the development of Layer 3 blockchain solutions:
Polygon (formerly Matic Network): Polygon wants to build an Ethereum-compatible multi-chain ecosystem that focuses on Layer 3 solutions for better dApp performance and scalability.
Skale Network: Skale Network has a Layer 3 solution that concentrates on scalable infrastructure for dApps, which means the process will be quicker and more efficient.
Cartesi: Another Layer 3 project is Cartesi, which uses off-chain computation and superior middleware solutions to boost the performance of dApps.
Final Thoughts
Layer 3 solutions are prominent as they surpass the drawbacks of Layer 1 and Layer 2 while providing substantial improvements in the dApps’ performance. These solutions suggest a future where decentralized applications are faster, more scalable, and more accessible for the user, enabling extensive application of the technology in various spheres.
Whether you are in gaming, finance, healthcare, or supply chain management, Layer 3 solution integration will change the way you approach blockchain. They are the future of blockchain technology since they can decrease costs, enhance integration, and present the best user experience ever.
We at Webmob Software, a blockchain consulting company, strive to provide you with the best dApp development solutions for your specific requirements. Our expertise in Layer 3 blockchain development ensures that your decentralized applications are not only sophisticated but efficient and highly functional.
Get in touch with Webmob Software today and let us assist you in creating excellent dApps that will differentiate you from the crowded blockchain market.
Chahat has a deep passion for leveraging blockchain technology to drive innovation and transformation. With over seven years of experience, she has been instrumental in guiding WebMob through the complexities of blockchain adoption. Her expertise and forward-thinking approach make her a key thought leader in the blockchain space, paving the way for a modern decentralized industry.