Layer 2 refers to a secondary network built on top of the [[Bitcoin]] and [[Ethereum]] blockchains that helps address scalability and transaction speed limitations of the base layer. In Bitcoin, Layer 2 solutions include the Lightning Network. It is a protocol that enables off-chain transactions between participants. By using payment channels, users can create a network of interconnected transactions that do not need to be recorded on the Bitcoin blockchain for each transaction. This allows for faster and cheaper microtransactions while still benefiting from the security of the underlying Bitcoin blockchain. In Ethereum, Layer 2 solutions are being developed to overcome congestion and high gas fees. These solutions include various types of sidechains, such as Optimistic Rollups and Plasma. Sidechains enable users to perform transactions off the main Ethereum chain, reducing congestion and increasing scalability. These transactions are then periodically settled on the main Ethereum blockchain, ensuring their security. Layer 2 solutions aim to improve scalability, reduce transaction costs, and increase transaction throughput while leveraging the security provided by the underlying blockchain. They provide an additional layer of functionality on top of the base layer without compromising decentralization or security. # References ```dataview Table title as Title, authors as Authors where contains(subject, "Layer 2") or contains(subject, "Control Layer") or contains(subject, "Control Plane") or contains(title, "Control Layer") or contains(title, "Control Plane") ```