Steemit Crypto Academy Contest / S13W5 - Layer 2 Blockchain

Layer 2 Blockchain topic is really interesting to me so I wanna participate in this interesting challenge this week. I will invite @malikusaman1 @steemdoctor1 and @chasad75 to kindly visit on my post. And participate in this challenge.

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What is layer 2 in a blockchain and how is it different from layer 1?

Blockchain
As we know a blockchain is a network which is decentralized and of nodes that processes crypto transactions. While using consensus mechanism to verify the accuracy of the transactions.
Cryptocurrency Blockchain may limits the transactions and this caused a major time waiting element for users, while transactions is being done.
Layers

Some times transaction takes 10 minutes or sometimes less. I experienced this myself.
Here comes Layers into the party. Because of continuous increasing of demand in Blockchain network. The scaling solutions is a thing on which Blockchain network will rely.

Which is originally the helping term for layer 1 and layer 2. These layers help to provide fast transactions and handling the transactions in Blockchain network for users.

These solutions help to lighten the transaction weight. To reduce the load on the network.
Layer 2 is more advanced in addressing some of the problems of Layer 1, this includes slower transaction speeds and higher transaction fees.

Difference Between Layer 1 and Layer 2

A layer one blockchain is the very basic layer, that the entire structure of the blockchain rests on it. This layer game is somewhat similar to how layers are used in photo or video editing. The bottom layer is the background of the photo or video.

But these layers differ from each other, there are some major differences, in Layer 1 and Layer 2.

Layer 2 blockchains are built right on top of layer 1 and all of the same functions contribute to the ease, speed, and agility of transactions.
But it is better and faster than the first layer.

As a simple example, if you build a house and build the bottom part of it, it will take more time, more money, and more fatigue. Because that is the foundation. And the work will also be a little slow.
Then on the other hand, if you build a second floor on top of this house, you will not have so much difficulty in building it, the work will be faster, and the money will be less.
I know the example is little away from topic, but I meant the transactions process will become easier and faster for layer 2.

It is the case that layer 1 is the layer in a blockchain upon which the entire blockchain depends. That is, from where it started, that's why it's tensions are high and it is taking time in transactions etc. It wasn't taking that much time either, but compared to the solution known as layer 2, layer 1 took more time for transactions.

Layer 1 is the core and foundation and architecture of the blockchain.
Whereas layer 2 depends on layer 1 to accelerate and support layer one.

Layer 1 scaling solutions are changes to the blockchain network’s base protocol that improve scalability. Layer 2 scaling solutions instead use off-chain services or networks to make scalability better.

Source

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Layer 2 has different types:

• Side chains
• Rollups
• State channels

Side chain In these, you have to trust a bridge network, and transactions have to go through the transaction process with the blockchain's validators, which are in a different set on that blockchain.

Rollups Because of this, multiple transactions can be completed in minimal time, or in just one transaction time.

In state channels mostly the process is same as side chain, but transactions are recorded in blocks of blocks in a broadcast network, this complete "state" of the network.

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Give real-world example of Layer 2 solutions and explain how it work.

I will try my best to give example and share the process of how it works.

Lightning Network

This is a second layer for Bitcoin. Which uses smaller payment streams to increase the volume of the blockchain to accommodate more transactions.
Its channels are transactions mechanism between two people. Both of which can transact. Payments can be taken from each other.
This is a kind of perfect solution for slow transactions on the Bitcoin blockchain, for their accuracy. This idea was first highlighted in 2016. And it is still under development since then.

Pixabay Image

How it works

This network uses channels that are in the hands of the participants. Due to this, transactions are facilitated quickly, without having to wait for any main net confirmation, the participants do their own transactions. Even when they close the channel, because they are done with their transaction. Transactions now go to the mainnet for the confirmation.

This is the Trade on the Go, at anywhere anytime service. And a best example of it. Usage
Most of the business deals can be done easily on this network, as well as the shopkeepers, restaurant holders can use this as their payment method.
Lightning Network is best example of State Channel a type of layer 2.

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How does layer 2 help reduce transaction fees on a blockchain and facilitate interoperability between different blockchains?

Transactions on decentralized networks, I mean blockchain requires fee and it goes to the miners and validators who process the transactions.
In Ethereum Network this is known as gas fee. We can understand with this example' that our transactions request first goes to the tool booth, or a block.
From where the transactions get verified and then forwarded to next. In the rush hours we can face slow transactions because of lack of users at the time. If the sender pay more, high gas fee his transactions can be done faster. Than others.

This traffic causes a push in the gas fee, and high the gas fees. And that's because of every user want his transactions to be done faster.

But there are solutions for this and one of them is layer 2. Layer 2 networks those are built on top of Blockchain. Just we can again understand with an example that this is a flyover on the road.
Which helps many drivers, and help to reduce the traffic too. This is same in the layer 2 on the Blockchain networks. These layers helps the transactions happens faster. With much lower fees.
We can say that the fee we were paying to the layer 1 validator at the time when there was no traffic, as that cheaper is the fee on layer 2.

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What is the underlying layer used by the Steem blockchain and how does this layer facilitate transactions and interactions on the platform?

Image Source

Steemit basically uses the steem Blockchain to store data. The all other actions on platform, rewarding users, posts, votes and resteem etc.

Witnesses on steemit are producing blocks, and the blocks then used to collect data, and then send to the steem Blockchain. This work is done continuously on steemit, and steem Blockchain is getting powered by witnesses. They collect and store data from entire network and then bundle it into a block and send that to steem Blockchain.
We can imagine and admire the work is done by witnesses that in, every three seconds a new block is produced.

And then the steem Blockchain is actually built on Graphene. That is an underlying layer. That is Graphene which is becoming popular among the most important industries among the world. Graphene blockchain technology competes with Ethereum and Bitcoin.

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Transactions
The transaction speed is very fast on the Steem platform due to Graphene. And that's why I said above that it's graphene that competes with Bitcoin and Ether. Because it provides very fast transaction at the time.
And interestingly, it beats Ether and Bitcoin in terms of fees. And handles all fees between transactions itself. And also saves users from fee tension. It is Graphene that allows many transactions to happen simultaneously on Steemit, and continues to happen. Which are very fast, and at least the user doesn't have to pay any fees.

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What would be the implications of integrating a layer 2 solution on the Steem blockchain in terms of scalability, costs and ease of use for users?

Such a second layer can have several benefits for Steemit users. That is the time we see when the transaction takes place, and only after some confirmations, our transaction takes place. Although that time is less, but it still happens enough that the users see it. It will also save this small amount of time. And as for the fee, the users did not have any difficulty before, nor was there any problem in terms of the fee.

In terms of scalability, the users will definitely benefit that the transactions that happen in many numbers at a time will start happening very quickly. As I discussed above by giving the example of flyover. And many users will be able to perform simultaneous actions and transactions. That too in a very short time.

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That's enough for this time, I tried to write what I could understand and write. Hope my post is better this time.