‍Layer 3 blockchain solutions are an additional layer that is added to Layer 2 to increase the scalability and overall performance of decentralized apps. 

Layer 1 acts as the initial foundation for a blockchain, with Layer 2 then being used as a ‘top up’ for the infrastructure already in place, optimizing its functionality. But what if you require a whole new application that needs to work independently of the previous Layers? 

They act as a specific network for apps to run off without the assistance of other blockchain layers. While blockchain Layer 1 and 2 work harmoniously together, Layer 3 takes the initial layering and becomes an independent entity.

Why are Layer 3 blockchains used?

‍Developers have found that Layer 3 solutions bring much to the table when developing blockchain protocols.

While Layer 1 and Layer 2 blockchains are incredibly useful for scaling your project and network, it is important to understand how taking advantage of Layer 3 is possible to get the most out of blockchain architecture. 

The blockchain trilemma is a common pain point for developers and investors. This is where scalability, security and decentralization comes into play and only two of them can be full

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Layer 3 benefits

There are many benefits presented by Layer 3 blockchains. They are:

• Scalability of dApps.
• Working as an independent entity allows Layer 3 applications to miss out on the initial layer. 
• Interoperability model.
• Blockchains and dApps can communicate with one another seamlessly, connecting them together.
• Increased security.
• Security measures are increased thanks to each Layer 3 application becoming segregated from other layers.

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Examples of Layer 3 blockchains

Like Layer 1 and Layer 2, there is a selection of Layer 3 blockchains that are used to fit different needs and motives. We have seen a drastic increase in the number of Layer 3 solutions available, here they are in some detail.

• Quant 

Quant's release in 2018 was the first of its kind. Introduced to allow interoperability between different blockchains, Quant's blockchain technology has helped connect more users on the blockchain. Efficiency and security have not been compromised, making Quant a critical player in advancing blockchain technology. 

• Starkware

Starkware is another example of a fantastic blockchain Layer 3 solution. It was initially started as a Layer 2 for the Ethereum blockchain but has seen the potential of Layer 3 and has moved its attention towards providing contemporary solutions. 

• Interledger Protocol

Interledger Protocol is another Layer 3 solution with high utility, making it a perfect addition for blockchain protocols. This ledger sits on the third layer of the Ripple blockchain, a prevalent Layer 1 blockchain. 

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The drawbacks of Layer 3

‍‍The cost 

Processing transactions can be more costly compared to the previous blockchain layer. This in itself is a big issue in the crypto industry.

Regulation

New functionality of the blockchain is added through Layer 3 solutions, meaning new discussions become necessary for regulation. 

They can be complex

Creating new layers on an existing blockchain can create complexity for those involved on both a development and user basis. 

Security and protection

Security for Layer 3 comes from the initial Layer 1 blockchain. If, for whatever reason, the security of that layer is compromised, this leaves Layer 3 also compromised. 

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What does the future hold for Layer 3? 

Layer 3 blockchains are a step in the right direction, along with the expansion of Layers 1 and 2. ‍

Time will tell how helpful Layer 3 is for developers. With the above information presented, along with the specific examples of Layer 3 blockchains, there is every chance that there could be a revolution in the blockchain. 

‍If you have enjoyed this article, be sure to visit the Cryptology Academy today to learn more about crypto and blockchain.

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FAQ 

Why is Layer 3 used?

Layer 3 is used as a further extension on top of Layers 1 and 2. It offers case-specific functionality, allowing decentralized applications to be more scalable and tailored for their audience’s wants and needs. 

‍ What are some examples of Layer 3 blockchain?

Layer 3 blockchain is still a new idea, although there are some key examples that are currently being utilized. They are: 

1. Quant
2. Interledger Protocol 
3. Starkware

These layer 3 have unique use cases, making them a valuable addition to the blockchain’s expansion. 

‍Why do we need Layer 3?

In order for the blockchain to be optimized to its full capacity, Layer 3 blockchain technology is necessary. Blockchains become more scalable as more users look to onboard different Layer 1 blockchains like Ethereum and Ripple. 

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