What Do Layer 2 NFTs Mean?
There is no better blockchain than Ethereum when it comes to NFTs. Nonetheless, the phrase “Ethereum killer” is rapidly being applied to some alternative networks that allow smart contracts.
The Solana network, for example, is classified as such because it has a proof-of-stake and proof-of-history mechanism that is both more energy-efficient and faster than Ethereum. Furthermore, Solana’s transaction fees are far lower — the network charges less than one cent each transaction.
Despite the benefits of alternative chains, Ethereum remains the most popular. Ethereum continues to outperform all other smart contract networks in terms of chain utilization and sales volumes. Ethereum, being the first and largest blockchain to enable NFTs, has a thriving ecosystem of NFT projects, dApps, developers, and collectors that would be difficult to abandon. This is especially true for NFT developers, who rely on Ethereum’s increased market exposure.
As a result, the name “Ethereum killers” has a more aspirational connotation. It emphasizes how the innovation observed in alternative chains addresses some of the Ethereum network’s perceived flaws, the most significant of which are scalability, energy efficiency, and transaction fees.
Transaction speeds decrease as the network becomes busier, and gas prices rise as users try to outbid each other. For certain users, this can make Ethereum excessively expensive — but that’s where Layer 2 solutions come in handy. ChainTechSource has put together an exclusive blog that explains the Layer 2 NFT, so read along.
What is Layer 2 NFT?
Layer 2 (L2) is a solution that is being developed for many blockchains. The goal of Layer 2 is to lower the transaction fees that customers pay when using the Ethereum platform. Layer 2 also tries to shorten the time it takes to conduct a transaction. The high gas prices are one of Ethereum’s major flaws; as a result, a solution to address this issue will be well-received by the community.
By grouping and rolling together all transactions on the network, Layer 2 addresses the issues of high gas expenses and poor transaction speeds. The Layer 2 solution then simultaneously uploads this transaction roll to Ethereum.
As a result of the procedure, the user spends less time acquiring the asset and pays less for each transaction. Layer 2 bears a load of those things when it delivers the packaged transactions that occurred, resulting in these benefits. The buyer wins from the process since their item is confirmed on the blockchain without them having to spend as much time or money as they would normally.
The first platform to support NFTs was Ethereum. As a result, the platform concluded that while blockchain technology was secure and decentralized, it was not scalable. Users may expect top-notch security from the platform, which also enables ultimate decentralization.
However, successfully scaling the various transactions that occur on it every day is a difficulty. The idea of minting NFTs on Ethereum, as well as the platform’s fluctuating popularity, causes the costs to fluctuate. Stability is necessary, and Layer 2 and NFT L2 solutions provided that stability.
Following the design and introduction of NFT layer 2 development solutions, a slew of Blockchains adopted it as their backbone. Here are some of the most effective Ethereum L2 solutions for resolving a variety of challenges.
Polygon is quickly becoming the industry’s most preferred Ethereum L2 solution. Regardless of the present financial downturn, the network continues to grow exponentially. Polygon also teamed with a number of well-known companies, including Graphlink, Umbrella Network, Kambria Open Innovation, and others.
Arbitrum is a platform that is prominent among the L2 scaling solutions. It has close Ethereum interoperability and allows Solidity developers to easily cross-compile their smart contracts. Compilers, validators, and the EthBrdige are the platform’s three main sections.
Cartesi is another great example of a well-known Ethereum scaling solution. More than just scalability and big transaction volumes are addressed by the platform. Cartesi’s L2 solution addresses compatibility difficulties with older hardware and software stacks.
The Polkadot network supports Parastate’s operations. The platform could be a viable alternative to the Ethereum Virtual Machine (EVM). It may also be able to provide seamless compatibility with Ethereum-based DApps.
The function of Layer 2 NFT
Layer 2 refers to a group of solutions that handle scalability difficulties. They process transactions off-chain, resulting in faster transaction times and lower transaction fees. They do, however, benefit from the robust decentralized security afforded by the blockchain because they’re constructed on top of the Ethereum Mainnet (Layer 1).
About Immutable X
Immutable X is a layer 2 Ethereum NFT trading protocol that works with both ERC-721 and ERC-20 tokens. By enabling quick trades, free gas fees, vast scalability, and carbon-neutral minting and trading, they expect to make minting and trading NFTs simpler than trading standard digital assets.
Immutable X could be used to exchange any NFT on Ethereum, but it also has its own marketplace with popular projects like Gods Unchained and Guild of Guardians. TikTok and Immutable X collaborated earlier this month to release TikTok Top Moments, their first NFT collection, which featured culturally significant TikToks from Lil Nas X and other prominent users. A CS:GO NFT collection has also been released by ESL Gaming in collaboration with Immutable X.
Many of the issues currently connected with trading Ethereum NFTs are addressed by layer 2 solutions like Immutable X. Layer 2 makes mining and trading NFTs on Ethereum cheaper while maintaining the same high security as the Ethereum Mainnet.
Furthermore, some use-cases, such as decentralized games utilizing NFTs as in-game assets, necessitate quick transactions for the game to run properly — this isn’t possible with Ethereum’s current transaction speed. As a result, Layer 2 solutions will broaden the scope of what can be accomplished on the Ethereum network, reducing so-called Ethereum killers to just contestants.
NFT L2 solutions appear to be the next big thing in terms of blockchain network resource utilization. However, because the solutions are still in the development or testing stages, it will take some time to see complete Layer 2 Ethereum solutions.