What is a layer 2 network and how does it work?
A layer 2 network runs on a base chain to make transactions faster and cheaper. Networks such as Arbitrum and Base use their own chain IDs and bridges.
Vahe HakobyanEditor-in-chief
Updated Oct 6, 20263 min readFact-checked
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- Layer 2 fees are usually lower, but bridging adds cost.
- Each layer 2 is its own network.
- A sidechain may not inherit base chain security.
Base chains can become busy when many people use them. A layer 2 gives users another place to transact while the base chain remains the final record.
How do you use a layer 2?
Getting funds onto a layer 2 takes a transfer from another network.
- Bridge from the base chain through the layer 2 bridge.
- Or withdraw from an exchange that supports the network.
- Check the network name in your wallet before you send.
- Networks such as Arbitrum and Base are separate, and a wrong network send can be hard to recover.
What do layer 2 fees cost?
A layer 2 usually charges lower fees than the base chain because it batches many transactions. Moving funds in or out is a base chain transaction, so you pay base chain fees. Fees can rise when either network is busy.
How does a layer 2 stay secure?
A layer 2 posts transaction data or proofs back to the base chain. The base chain stores that record and can settle disputes. That link is how it uses base chain security.
The exact method varies by network. If that link breaks, users may face limits on withdrawals.
Layer 2 vs sidechain: what is the difference?
A true layer 2 posts data or proofs back to the base chain. A sidechain is a separate chain that often runs its own validators, so it may not inherit base chain security.
Frequently asked questions
Usually no. Most wallets let you add a network and switch to it. You may need its chain ID.
No. Fees on many layer 2s are paid in the base chain coin, such as ether. Some have their own token.
They may not be lost forever, but recovery is difficult. You may need the receiving service to help.
Yes. Operators can change the rules or stop operating. Users may then have limited time to move funds back.
