Ethereum Layer 2 (L2) solutions present significant investment opportunities as they address the scalability limitations of Ethereum's Layer 1 (L1), such as high gas fees and low transaction throughput (currently around 15 transactions per second). L2 solutions, including Optimistic Rollups (e.g., Arbitrum, Optimism), Zero-Knowledge Rollups (e.g., zkSync, StarkNet), and sidechains (e.g., Polygon), enhance Ethereum’s ecosystem by processing transactions off-chain while leveraging L1’s security. This makes them faster and cheaper, with some L2s achieving hundreds or even thousands of transactions per second (TPS), alongside gas fees that can be 80-90% lower than L1.