Top 5 Ethereum-Based Layer 2 Coins-The news of Ethereum ETF approval is around the corner. Just like the altcoins in the ecosystem of bitcoin witnessed major rallies in their prices after bitcoin approval, the Ethereum based coins can follow the same suit after ETH ETF approval.
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Top 5 Ethereum-Based Layer 2 Coins
These top 5 Ethereum ecosystem based Layer 2 coins can pump after the Ethereum ETF approval. There is a logic behind this as to why these coins can pump. As per data sources the whales have already started accumulating these 5 altcoins.
The logic is that whenever the price of Ethereum rises, which will certainly rise after its ETF approval, its gas fee always increases. Users who need to transfer their funds from one wallet to another, are charged heavy transaction fees and the Ethereum network gets congested.
This were the Layer 2 tokens come into picture which offer very low yet fast transactions. Layer 2 tokens run in parallel with the Layers 1 tokens of Ethereum and which can used to transfer same tokens to other wallets and exchanges.
where you have to pay $50 gas fee in Ethereum network, same transaction can be executed with just $0.01 -$1 with Layer 2 tokens. Now lets dive into the list of these top 5 Ethereum based Layer 2 coins.
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1.Polygon (MATIC)
Formerly known as MATIC, Polygon works as a bridge between the Ethereum network and its sidechains. It is a Layer 2 scaling platform that enhances scalability and interoperability. Currently it appears dead, but it is a sleeping giant.
Key Features of Matic
- Scalability
- Side chains-Numerous and public in nature
- Security- As operators are themselves the stakers.
- EVM Compatibility-It is compatible with Ethereum based smart contracts.
- Broad Ecosystem- Like DeFi, NFTs and gaming.
Use Cases of Matic Coin:
- DApps NFT marketplaces
- cross-chain interoperability
2.Arbitrum (ARB)
Arbitrum is yet another solid Layer 2 project that brings itself with high speed and cost effective transactions. It’s approach involves handling the majority of transactions off-chain, only occasionally presenting proofs to the Ethereum mainnet.
This strategy not only boosts efficiency but also reduces reliance on Artificial Intelligence thus ensuring a more human-centric approach to scaling Ethereum’s capabilities.
Key Features of ARB:
- Optimistic Rollup: An optimistic rollup mechanism is there to handle a large number of transactions securely.
- Compatibility: in deploying existing Ethereum smart contracts on Arbitrum.
- Decentralization: maintains a balance between scalability and decentralization.
Use Cases of Arbitrum:
- DApps
- DeFi protocols
- NFT
3.Optimism (OP)
Optimism is another well known Layer 2 solution powered by Ethereum. It focuses on scalability and usability, allowing developers to port their Decentralized Apps seamlessly
Key Features of OP:
- Rollups: Optimism uses rollups mechanism to bundle multiple transactions into a single batch thus reducing gas fees.
- Fast Finality: Transactions are confirmed quickly, providing a better user experience.
- Developer-Friendly: Developers can use existing Ethereum tools and libraries with minimal changes.
Use Cases of Optimism:
- Gaming
- Decentralized exchanges (DEXs)
- Fast and cost-effective transactions for applications.
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4. ImmutableX (IMX)
ImmutableX is a Layer 2 protocol specifically designed for NFTs on Ethereum. It offers massive scalability and gas-free transactions for minting and trading NFTs.
Key Features of IMX:
- Zero Gas Fees: IMX offers a zero gas fee platform for minting and trading NFTs on EThereum.
- Instant Trade Settlement: with regard to NFT trades
- Decentralization: with as good as Ethereum-level security.
Use Cases of IMX:
- NFT marketplaces
- Gaming
- Digital collectibles.
5. Metis (METIS)
Metis focuses on creating decentralized economies by enabling businesses and individuals to build their Layer 2 chains.
Key Features of METIS:
- Layer 2 Framework: Metis provides a customizable framework for creating Layer 2 solutions tailored to specific needs.
- Scalability: Projects can be scaled efficiently without compromising their security.
- Staking and Governance: METIS tokens play a role in staking and governance.
Use Cases of METIS:
- DApps
- Tokenization of assets
- Community-driven platforms