L1 blockchains are the “classical blockchains”, they provide their own consensus algorithm and use either PoS or PoW to mine or validate transactions. L1 blockchains include Ethereum, Polygon, NEAR, Polkadot and many others. Currently (2022), they are the most popular blockchain type.
At the time of writing, Ethereum is by far the most commonly used platform for decentralized applications. As the first blockchain network to implement smart contracts, Ethereum remains the most widely adopted protocol for decentralized apps (dApps) and ICOs. Ethereum has a large developer community, numerous mature development frameworks, and is one of the most secure blockchains available. It also has the largest amount of assets that are being traded on its network.
- Security: It is one of the safest blockchains in the market.
- Flexibility: It supports the biggest variety of programming languages and tooling.
- Widely used: It has been around the longest and has the largest ecosystem, most users and largest total-value-locked (TVL)
- Price: Ethereum is one of the most expensive blockchains to run transactions on. With an average transaction cost varying from $10 – $500, it’s easy to see why not all developers wish to build on ETH.
- Speed: Ethereum has a relatively low transaction throughput of ~10tx/s and the average time to include a transaction in a block is over a minute. This can be detrimental to apps looking for a more “real-time” feel.
One of the fastest growing blockchain platforms, Polygon is being touted as the “next-generation blockchain”. This claim is based on the fact that it uses a Proof of Stake model to reduce transaction time and cost. This model provides a lot of advantages for developers, particularly when it comes to speed at which the transactions are included in the blockchain. Being one of the first PoS blockchains and leveraging a very aggressive expansion strategy – Polygon has almost all of the big DeFi and NFT projects available, as well as a very large TVL (total-value-locked). However, the critics say that the security model of Polygon is flawed, as the entire chain is secured by a multi-sig wallet with a very limited amount of signers. Some users also report intermittent unavailability of the chain – requiring a more time than advertised for a transaction to be considered truly finalised!
- Large community: After Ethereum, Polygon has one of the largest community of users and most DeFi protocols are available on Polygon.
- Speed: Transactions are usually validated in a few seconds.
- Cost: Transactions are quite cheap to execute, in a range from a few cents to a few dollars.
- Security model: While Polygon hasn’t had any outages or major exploits as of yet – the multisig model is not very secure in comparison to ETH or some other chains on this list.
- Chain reorgs: Sometimes, it can take up to a hundred blocks to verify that the transaction is finalised due to potential “chain reorgs”
An Optimistic Rollup is a blockchain that relies on the security of another, more established blockchain (the “parent blockchain”) for its security. Instead of relying on their own consensus mechanism (such as PoW or PoS), Optimistic Rollups utilise their parent blockchain’s mechanism (in this case, Ethereum).
Optimism, or Optimistic Ethereum is an L2 scaling solution for Ethereum and other EVM chains. It uses the technology of “Optimistic Rollups”.