Farcaster

Scalability is blockchain's next big challenge. Layer 1 solutions like Ethereum 2.0 focus on improving the base layer. Layer 2 solutions, such as Lightning Network and Rollups, aim to enhance transaction throughput without altering the core protocol. Each has tradeoffs: L1 offers security and decentralization but faces technical hurdles; L2 boosts speed and efficiency but introduces complexity. Understanding these can guide your crypto investments.

Absolutely. Balancing scalability with security and decentralization is crucial. L1 like Ethereum 2.0 promises foundational improvements, while L2 solutions like Lightning Network and Rollups address immediate needs. Investors should monitor both for potential disruptions and opportunities.