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, the choice between Layer 1 and Layer 2 solutions is crucial. Ethereum 2.0 brings promising improvements with sharding, while L2s like Rollups and Lightning Network offer immediate scalability gains. Investors should consider long-term security and decentralization alongside performance needs.