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Layer 0 Meaning

Oct 20, 2023 | Updated Oct 20, 2023
Layer 0 is the foundational infrastructure on which other blockchains and applications are built.

What is Layer 0 in Blockchain?

A blockchain ecosystem is categorized into layers based on how the blockchain is built and how it executes its function. Layer 0 is the foundational layer where other blockchains, especially Layer 1s, are built. It is basically the “blockchain for blockchains”.

Layer 1 blockchains form the basis for developers to build their applications. Layer 2 blockchains are the scaling solutions built on top of the Layer 1s to improve their capabilities, such as network efficiency and higher transaction throughput. Examples of Layer 2 solutions are Lightning Network and Plasma. 

Finally, Layer 3 describes the protocols built on top of Layer 2 to provide application-specific networks. Layer 3 hosts other dApps, crypto wallets, and games.

Layer 1 blockchains, such as Ethereum and Solana, are more popular. However, they are considered monolithic, meaning all their functions are sustained on a single network. And as their popularity continues to grow, they have become prone to blockchain trilemma (also called the scalability trilemma), where the developers face a tradeoff between scalability, decentralization, and security. Layer 0s aims to tackle this trilemma. 

What Blockchain Challenges Can Layer 0 Solve?

Scalability Issues

Layer 1 blockchains face difficulties in improving transaction throughput and efficiency without compromising security and decentralization.  

When a single protocol is responsible for all the critical functions, such as establishing consensus, executing transactions, and making data available, it can make monolithic blockchains overwhelmed. The blockchain’s ability to adapt to growing demand is then compromised. 

Interoperability Problems

Interoperability is the ability of blockchain networks to communicate and share resources freely. Most layer 1 blockchains are created through specific designs that hinder interoperability and need dedicated bridges to share resources.

Flexibility and Usability Issues

Flexibility and usability are the ease with which a dApp can be utilized on different blockchains. Layer 1 blockchains are only compatible with dApps developed using specific protocols. For instance, a dApp built for Solana will not run on another chain, such as Ethereum or Cardano.

How Do Layer 0 Protocols Solve Scalability Trilemma?

Layer 0 blockchain protocols are made of three elements that work to solve the blockchain challenges for host networks. The elements include the main chain, side chain, and cross-chain transfer protocol.

Main chain

The central block or main chain is the underlying infrastructure that enables the Layer 0’s consensus and governance mechanisms. It also records and preserves transactions from Layer 1’s.

Sidechain

Sidechains are protocols to sustain dApps and address Layer 2’s scalability challenges. Sidechains run independently from the parent blockchain and have different features and functionalities, such as consensus algorithms and block parameters. 

Sidechains offer more optimized end-user experiences and facilitate seamless resources and data sharing between blockchains. 

Cross-chain Transfer Protocol

The Cross-chain (inter-blockchain) transfer protocol is the mechanism that facilitates seamless communication and data exchange between chains without the need for dedicated bridges.

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