Best Layer 2 Protocols for Small Business

Loopring serves as an open protocol designed for the creation of scalable non-custodial exchanges on the Ethereum network. By utilizing zero-knowledge proofs (zkRollup), it facilitates efficient trading with high throughput and low settlement fees while ensuring the robust security measures characteristic of Ethereum. Throughout the entire trading process, users retain complete control over their assets. You can explore trading on Loopring to experience its features firsthand. As a protocol that is open-sourced, audited, and non-custodial, it eliminates the need for trust among participants within the Loopring ecosystem. Users’ cryptoassets are consistently under their own control, backed by 100% security guarantees equivalent to Ethereum's standards. Loopring enhances the capacity of decentralized exchanges by processing thousands of requests off-chain, ensuring verifiable execution through zero-knowledge proofs. Consequently, the limitations of underlying blockchains are no longer a hindrance to performance. Most functions, such as order-matching and trade settlement, are conducted off the Ethereum blockchain, streamlining operations and enhancing efficiency. This innovative approach positions Loopring as a leader in the realm of decentralized finance.

Meter serves as a highly efficient infrastructure designed to enable smart contracts to scale and navigate effortlessly across diverse blockchain networks. Functioning as both a Layer 1 and Layer 2 blockchain protocol, Meter is built around two primary tokens: MTRG, which acts as the governance token (with eMTRG representing its ERC20 version), and MTR, designed to be a stable currency token. To facilitate the unrestricted movement of financial assets between blockchains, Meter employs a HotStuff-based consensus mechanism that supports thousands of validator nodes, positioning it as the most decentralized Layer 2 solution for Ethereum. With the capacity to process thousands of transactions every second, transactions on Meter are confirmed in nearly real time. Additionally, Meter Passport enables assets and smart contracts to traverse and interact across various blockchains, optimizing for price, liquidity, and yield. Meter stands out as an Ethereum-compatible platform enhanced with distinctive features. In contrast to other Layer 2 solutions, decentralized exchanges (DEXes) built on Meter are resistant to front running and miner extractable value (MEV) issues, ensuring they are both swift and censorship-resistant. This combination of capabilities makes Meter a formidable player in the blockchain ecosystem.

The next-generation layer 2 solution for Ethereum decentralized applications (dApps) allows developers to leverage their preferred tools while achieving cost-effective scaling for their projects. In this ecosystem, an aggregator functions similarly to a node in the Ethereum network, enabling client software to perform remote procedure calls (RPCs) to interact with an Arbitrum chain via a standard API. Once a client makes a request, the aggregator interacts with the EthBridge to generate transaction results, akin to the operation of an Ethereum node. Although most clients will typically route their transaction submissions through an aggregator for efficiency, it is not a strict requirement for operation. There are no restrictions on the number of aggregators that can be established, nor on who is eligible to serve as one. To enhance processing efficiency, aggregators often consolidate several client transactions into a singular message for submission to the Arbitrum chain. Additionally, Arbitrum features a specialized Sequencer that has the capability to prioritize transaction ordering and provide rapid transaction receipts, further optimizing the user experience. This innovative structure opens up new possibilities for developers looking to enhance their dApps on Ethereum.

A community focused on open-source development is dedicated to enhancing Bitcoin's scalability, particularly its proof-of-work security, to accommodate global demands and new applications, while striving to remain true to Bitcoin's foundational principles. With a decade of advancements since its mainnet launch, Syscoin has positioned itself as a leader in offering a robust network and protocol tailored for projects seeking to implement Bitcoin L2 solutions. As a Bitcoin L2 operating on the mainnet, Syscoin introduces a data availability protocol that enables the realization of EVM and AltVM rollups on the Bitcoin blockchain. By being merge-mined by a significant portion of Bitcoin's hash rate, Syscoin effectively anchors these rollups to the integrity of Bitcoin's proof-of-work mechanism, seamlessly integrating with the existing sequencer architectures of these rollups. Additionally, Syscoin delivers a scalable data availability layer for Bitcoin, essential for rollups and other EVM or AltVM layers, allowing them to connect to Bitcoin’s network securely and efficiently. This innovative approach not only enhances Bitcoin’s utility but also strengthens its position in the evolving cryptocurrency landscape.

Polkadot is an innovative blockchain network designed to support Web 3.0, which aims to create a decentralized and equitable internet where individuals have control over their data, fostering thriving markets through enhanced network efficiency and security. Established in 2016 by Gavin Wood, who previously served as the Co-Founder and CTO of Ethereum, Polkadot addresses key challenges that have hindered the widespread adoption of blockchain technology in recent years. The platform's development toolkit, known as Substrate, was created by Parity Technologies and simplifies the process for developers to create tailored blockchains suited to their specific needs. Additionally, Polkadot facilitates interoperability between various blockchains, making upgrades seamless, and introduces a model of “shared security” that allows developers to prioritize their technological innovations rather than expend resources on assembling a team of operators to manage a new blockchain. This approach not only streamlines the development process but also enhances the overall robustness of the blockchain ecosystem.

Liquidity offers a far superior way to manage your finances and cryptocurrency assets, no matter your location or identity. Unlike traditional banks, we do not have the ability to freeze your funds; instead, we communicate with our clients in a personable manner, eliminate hidden fees, and prioritize technology and research in all our endeavors. The security of our users is paramount, ensuring they maintain full control over their assets at all times. With Liquidity Network, transaction speeds are not limited by blockchain constraints, allowing for seamless gasless transfers and swaps. Developers benefit from an intuitive API that facilitates the creation of user-friendly decentralized applications. Our work, grounded in peer-reviewed research, is accessible to the public, aimed at providing a secure and scalable solution for the community. The smart contracts of Liquidity Network are entirely open-source, distributed under the GNU General Public License v3.0, promoting transparency and collaboration. LQD serves as the primary utility token for accessing various services within the Liquidity Network ecosystem. Imagine instantaneous transfers, real-time spending alerts, effortless cryptocurrency swapping, and a streamlined method to send money to friends. With these features, managing your financial activities becomes more efficient and user-friendly than ever before.

Base is a secure, cost-effective, and developer-friendly layer 2 solution for Ethereum, designed to usher in the next billion users to the web3 ecosystem. It offers the essential security and scalability required for your decentralized applications, utilizing Ethereum's foundational security while allowing smooth onboarding from Coinbase, Ethereum L1, and other compatible chains. Experience the Ethereum Virtual Machine (EVM) at a reduced cost, and gain early access to advanced Ethereum functionalities like Account Abstraction (ERC4337), alongside straightforward developer APIs for gasless transactions and smart contract wallets. Built on Optimism’s open-source OP Stack, Base provides an effortless way for decentralized applications to tap into the extensive range of products and distribution options from Coinbase. With seamless integrations, easy fiat onramps, and entry into the Coinbase ecosystem—home to 110 million verified users and $80 billion in assets—Base positions itself as a pivotal player in the web3 landscape. The combination of innovative features and robust support makes Base an attractive option for developers looking to create impactful decentralized applications.

COMBO stands out as a premier provider of scaling solutions tailored for the development of Web3 games. Utilizing the most advanced game engine available, COMBO is creating an open-source, decentralized protocol focused on gaming that is designed for universal accessibility. Its mission is to unlock the full potential of Web3 gaming by seamlessly connecting developers with the broader ecosystem in a manner that is efficient, cost-effective, and secure. To support this initiative, COMBO has established robust partnerships with top-tier Web3 infrastructure projects, offering a suite of development tools and integrated game engines. These sophisticated resources enable game creators to enter the Web3 landscape with ease while streamlining and speeding up their development processes. Through the implementation of optimistic rollup technology, the platform can achieve over 5,000 transactions per second, all while maintaining extremely low gas fees of just 0.000000008 Gwei. Additionally, COMBO’s commitment to innovation is reflected in its ongoing efforts to enhance the gaming experience within the decentralized landscape.

Carbon serves as a foundational cross-chain protocol designed for the decentralized finance (DeFi) ecosystem. It enables users to create open financial markets for various asset types across multiple blockchains. The protocol is the backbone of Demex, a well-known decentralized exchange that facilitates the trading of a wide array of financial instruments. By leveraging the PolyNetwork bridge, Carbon ensures true cross-chain liquidity pools, allowing for seamless interactions between networks such as Ethereum, Cosmos, BSC, Neo, and Zilliqa. Additionally, it fosters innovation within the DeFi space by offering native support for crypto derivatives, Balancer-style liquidity pools, automated market makers (AMMs), and on-chain order books, among other features. Built using the Cosmos-SDK, the protocol is fortified by a robust validator network operating under Tendermint's Proof of Stake consensus mechanism, ensuring secure and trustless transactions. This unique combination of features positions Carbon as a vital player in the ever-evolving DeFi landscape.

Liquid is a unique settlement network built on a sidechain that enhances the speed and confidentiality of Bitcoin transactions for traders and exchanges, facilitating the creation of various digital assets. Transactions on the Liquid network are finalized in just two minutes, which allows traders to quickly transfer funds between exchanges and personal wallets without enduring lengthy confirmation delays. The platform provides an opportunity for anyone to create new assets, ranging from stablecoins to security tokens. Within Liquid’s ecosystem, these assets can be traded freely while leveraging its robust features for privacy, speed, and secure transactions. By default, details regarding asset types and amounts are concealed on the Liquid sidechain, ensuring that traders' private financial information remains protected from external parties and helping to mitigate risks related to large order front-running. Additionally, the open-source Liquid Swaps Tool enables seamless exchanges between different assets on the network, enhancing liquidity and trading options. This innovative approach not only streamlines transactions but also empowers users with greater control over their digital assets.

The Raiden Network serves as an off-chain scaling solution that facilitates almost instantaneous, low-cost, and scalable transactions. It is designed to work in harmony with the Ethereum blockchain and is compatible with any token that adheres to the ERC20 standard. As an ongoing project, its primary focus is to explore state channel technology, establish protocols, and create reference implementations. Positioned as an additional infrastructure layer atop the Ethereum blockchain, the fundamental concept is straightforward; however, the intricacies of the underlying protocol and its implementation are notably complex. Despite these challenges, developers can simplify these technical aspects and utilize a user-friendly API to create scalable decentralized applications that leverage the Raiden Network. The core objective of this network is to bypass the consensus bottleneck commonly associated with blockchains. This is achieved through the establishment of a network of payment channels, which allows for secure off-chain value transfers, thereby minimizing the need to engage the blockchain for each transaction. As the project continues to evolve, it aims to enhance the overall efficiency of decentralized finance applications.

In collaboration with some of the most prominent figures in fine art, cryptoart, and entertainment, we are establishing an innovative creative studio and NFT community on Ethereum that prioritizes scalability and sustainability. Palm NFT Studio facilitates the integration of projects and platforms into the Palm ecosystem by partnering with artists, creatives, marketplaces, and rights holders. Engineered with flexibility in mind, Palm is tailored to accommodate the diverse creativity of artists. Currently, we are enhancing the usability and efficiency of NFTs through an Ethereum sidechain, with plans to evolve into an Ethereum Layer 2 in the near future. Creators engaged with the Palm ecosystem will enjoy significantly reduced gas fees, while the ecosystem itself will create incentives for both creators and participants alike. This commitment to fostering a vibrant community will further enhance collaboration and innovation within the NFT space.

Truebit serves as an enhancement to blockchain technology, allowing smart contracts to execute intricate computations in conventional programming languages while minimizing gas expenses. Although smart contracts excel at handling minor computations with accuracy, they face significant security vulnerabilities when tasked with larger computations. To address this issue, Truebit introduces a trustless oracle that retrofits existing systems, ensuring the accurate execution of complex tasks. Smart contracts can submit their computation requests to this oracle in the format of WebAssembly bytecode, and in return, anonymous miners earn rewards for providing correct solutions. The protocol of the oracle upholds accuracy through two distinct layers: a unanimous consensus layer that permits anyone to challenge incorrect answers and an on-chain system that motivates engagement and guarantees equitable compensation for participants. The realization of these elements is achieved through an innovative blend of off-chain infrastructure and on-chain smart contracts, thereby enhancing the overall functionality and security of blockchain networks. This dual approach not only improves computational reliability but also fosters a more robust ecosystem for decentralized applications.

Deploy your decentralized applications within a modular cloud designed for practical use and tailored to your specific needs. SKALE Networks introduces a groundbreaking modular protocol that enables developers to effortlessly create highly adaptable blockchains, ensuring the advantages of decentralization while maintaining robust computation, storage, and security capabilities. These elastic blockchains are not only efficient and decentralized but also fully compatible with Ethereum, leveraging cutting-edge advancements in modern cryptography to guarantee security. By implementing Byzantine Fault Tolerance (BFT), the system ensures that consensus can still be achieved even if up to one-third of participants act maliciously. Mirroring the operational model of the Internet, this protocol takes into account the latencies of both nodes and the network, permitting messages the flexibility of delayed delivery. Furthermore, BLS Threshold Signatures facilitate seamless interchain communication and enhance randomness in the allocation of nodes, ultimately contributing to a more resilient network. This innovative approach paves the way for a new era of decentralized application deployment.

Starknet functions as a decentralized ZK-Rollup on Ethereum, operating without permission and allowing any decentralized application (dApp) to attain boundless computational scale while maintaining Ethereum's security and composability. By generating STARK proofs off-chain and verifying them on-chain, Starknet successfully scales while safeguarding the integrity of Layer 1 Ethereum. Developers can seamlessly implement diverse business logic through Starknet Contracts, promoting Ethereum-level composability that encourages straightforward development and fosters innovation. The STARK Prover drives the StarkEx scalability engine, showcasing its capability to handle up to 600,000 transactions in a single proof on Mainnet, which highlights its efficiency and robustness. This combination of features positions Starknet as a vital infrastructure for the next generation of decentralized applications.

In the early days of the internet, applications were confined to isolated networks that required various methods of access and interaction. Today, we find ourselves in a similarly fragmented environment where different ecosystems lack robust interoperability. The Nervos Network addresses these issues by providing a comprehensive array of solutions that empower developers to create Universal Apps. Users can select their preferred interface and cryptocurrency while still being able to navigate through the entire ecosystem seamlessly. Gone are the days of juggling multiple wallets, exchanges, and seed phrases, as Nervos simplifies this process. By building on Nervos, developers can effortlessly target any Virtual Machine (VM), allowing for smooth porting of decentralized applications and immediate access to the broader blockchain landscape. Additionally, the platform incorporates sustainable crypto-economics with a built-in store of value mechanism, tackling some of the most pressing sustainability challenges faced by public blockchains today. This innovative approach not only enhances user experience but also fosters a more interconnected and efficient blockchain network.

ChainX, recognized as the first project to emerge within the Polkadot ecosystem, is dedicated to exploring and implementing advancements in Bitcoin's layer 2 scalability, serving as a digital asset gateway and a relay chain for Polkadot's second layer. Its goal is to facilitate cross-chain asset exchanges, paving the way for innovative developments in Bitcoin Cross-DeFi. With Bitcoin's market capitalization nearing the monumental US$1 Trillion mark, it stands as a cornerstone of the digital currency landscape, holding tremendous potential for evolving blockchain technologies and affirming Bitcoin's role as a leading payment option and an effective medium for value transfer and storage. Many believe that we have only begun to uncover the vast possibilities that Bitcoin offers. ChainX is fervently focused on enhancing and expanding Bitcoin's Layer 2 financial ecosystem, working to foster the flow of Bitcoin's value, broaden opportunities for financial derivatives, and enhance tools for hedging against market fluctuations. By doing so, they aim to unlock even greater potential for users and investors alike.

Celer Network operates as a layer-2 scaling solution designed to facilitate rapid, secure, and economical blockchain applications across Ethereum, Polkadot, and various other blockchain platforms, aiming for widespread adoption. It pioneered the world's first Generalized State Channel Network and continues to innovate in the layer-2 scaling sector through its advanced Rollup technology. Notable applications and middleware such as cBridge and Layer2.Finance, along with other ecosystem projects developed on the Celer platform, have drawn considerable interest from diverse audiences in the realms of DeFi, blockchain interoperability, and gaming. Layer2.Finance specifically addresses the two primary obstacles hindering DeFi's mass adoption: the prohibitively high transaction fees and the complexity of usage. Additionally, cBridge is a versatile multi-chain network that facilitates instant, cost-effective, and seamless value transfers across various Ethereum layer-2 chains, the Ethereum main chain, and in the future, other layer-1 and layer-2 solutions. As Celer Network evolves, it continues to enhance user experience and broaden access to blockchain technology for all.

StarkEx is designed to generate validity proofs, which guarantee that only legitimate data derived from trustworthy computations is recorded on the blockchain. The remarkable scalability of StarkEx stems from the asymmetric workload distribution between its off-chain prover and the on-chain verifier. It supports self-custodial decentralized applications (dApps) and incorporates cutting-edge anti-censorship measures to ensure that users maintain control over their funds at all times. Furthermore, StarkEx has been crafted to accommodate a wide variety of user requirements and application functionalities. Applications seeking to connect with StarkEx can typically launch on the Mainnet within a few weeks, depending on how advanced their off-chain Operator node is. With the implementation of validity proofs, state updates achieve finality as soon as they are confirmed on-chain, which can take just hours, unlike fraud proofs that require a lengthier dispute resolution period. This efficiency not only streamlines the transaction process but also enhances the overall user experience in utilizing blockchain technology.

Raydius serves as a middleware platform aimed at enhancing the interconnectedness of the blockchain landscape. At present, creating applications that operate across multiple chains poses significant challenges due to the various Layer 1 and Layer 2 protocols, each with its unique development frameworks. To tackle this issue, Raydius provides cross-layer support as a service, enabling developers to concentrate on crafting the products that are most essential for users. It features an Ethereum Virtual Machine (EVM) compatible Layer 2 Proof of Stake (PoS) side chain built on the Substrate framework, which facilitates connections to numerous Layer 1 and Layer 2 blockchains via bi-directional bridges. Additionally, Raydius incorporates cross-chain bridge aggregators that offer users a seamless experience when utilizing decentralized applications (dApps) across different blockchain networks. The Raydius bridge aggregator collaborates with well-known asset bridges such as multichain.xyz, Matic, and Binance Smart Chain (BSC), ensuring optimal routing for users looking to transfer assets between various blockchains. With this comprehensive approach, Raydius not only simplifies development but also enhances user accessibility to a diverse range of blockchain services.

Godwoken operates as an optimistic rollup, drawing its security from Layer 1 while offering immediate transaction finality and minimal fees within an entirely Ethereum-compatible framework on the Nervos platform. This integration empowers Ethereum developers to effortlessly transfer their decentralized applications (dApps) to Nervos, positioning them within the evolving DeFi landscape. Additionally, Godwoken serves as a multi-chain solution that incorporates sophisticated account abstraction, facilitating both flexible wallet options and traditional user accounts for a more internet-like user experience. Furthermore, cross-chain assets such as ETH and ERC-20 tokens can be utilized within the dApps launched on Nervos through the innovative Force Bridge, enhancing interoperability in the ecosystem. In this way, Godwoken not only promotes accessibility but also encourages the growth of a vibrant, interconnected blockchain community.

Boba represents an advanced Ethereum Layer 2 Optimistic Rollup solution designed to lower gas costs, enhance transaction speed, and broaden the functionality of smart contracts. With the assistance of community-driven liquidity pools, Boba enables rapid exits by significantly reducing the Optimistic Rollup exit timeframe from seven days to just a matter of minutes, while simultaneously offering liquidity providers enticing yield farming options. Developers within the Ethereum ecosystem will benefit from Boba’s extensible smart contracts, allowing them to create decentralized applications that utilize code executed on large-scale infrastructure like AWS Lambda, thereby facilitating the use of algorithms that would be too costly or unfeasible to run on-chain. Our approach to building Boba prioritizes both users and developers, aiming to create a practical Layer 2 solution that paves the way for the next billion users to access Ethereum. We invite you to participate in this journey and contribute to the growth of our vibrant community. Together, we can reshape the Ethereum landscape for years to come.

The emerging landscape of digital currency is rooted in transparency, yet this comes at a significant cost, as all your financial interactions are fully visible to your counterparties. Aztec serves as the ultimate fortress for safeguarding user and business information within Web3.0, ensuring that data remains confidential. By utilizing cryptographic techniques, it conceals the identities of both senders and recipients. Furthermore, the amounts involved in transactions are encrypted, preserving the privacy of your cryptocurrency holdings. Observers on the network are unable to determine the specific asset or service tied to any transaction, enhancing security. Developed on PLONK, a cutting-edge standard in universal SNARK technology, Aztec's solutions are crafted by an elite team of cryptographers. Transactions are processed in mere seconds across all devices, while our rollup service efficiently reduces gas fees and settles in just minutes. You can manage your DeFi positions discreetly and conduct trades under the protective umbrella of Aztec's privacy features. Whether it's programming private money, setting up escrow, facilitating money streaming, or handling micropayments, the possibilities are boundless. In this innovative ecosystem, privacy is not just an option; it is a fundamental principle that empowers users to transact freely without fear of exposure.

Participate in staking on Ethereum's pioneering private computing platform and start earning rewards. Engaging with Keep represents an optimal method to support a genuinely decentralized ecosystem and the advancement of decentralized finance (DeFi). This infrastructure prioritizes privacy while operating on a public blockchain. The Keep network facilitates the utilization of private data on open protocols, ensuring confidentiality remains intact. As the sole truly decentralized protocol, Keep utilizes "Keeps," which are off-chain containers that enable contracts to access private data without revealing it on the public blockchain. It employs top-tier encryption to safeguard stored data, and both Keep and tBTC have undergone rigorous audits by leading firms in the industry. Explore the opportunities for staking on the Keep network to earn rewards and contribute to its security. Notably, Keep functions as a privacy layer that permits the safe use of private data on public blockchains, maintaining both security and confidentiality. Furthermore, Keep is the driving force behind tBTC, marking the introduction of the first secure and decentralized tokenized version of Bitcoin on the Ethereum platform.

Perun is an innovative off-chain framework that facilitates real-time payments along with intricate business logic, enhancing the capabilities of any blockchain. By connecting users across various blockchains, Perun promotes interoperability among different currencies and blockchain networks. This results in instantaneous, energy-efficient, and low-cost transactions, leveraging Layer-2 technology to significantly boost throughput. With the use of virtual channel technology, Perun ensures that transaction data remains private while continually demonstrating robust security measures to uphold advanced procedures. Additionally, Perun enables payments through NFC and Bluetooth, functioning seamlessly even without an active internet connection. A key aspect of Perun’s off-chain framework is its State Channels, which allow users to perform a large volume of transactions off-chain while maintaining security through the underlying blockchain. Furthermore, the integrity of our protocols has been rigorously evaluated using state-of-the-art cryptographic research methods, ensuring the highest standards of reliability and safety. This combination of advanced technology and robust security positions Perun as a leading solution for modern payment needs.