Why ThunderCore Outperforms Layer 2 Solutions
By: Thundercore Team
Tags: Blockchain Technology, Scalability, Thundercore, Layer 2, Blockchain

Layer 2, also known as off-chain solution, is a way to solve scalability and congestion issues for blockchains with heavy traffic and high gas fees. There are several Layer 2 solutions, however, each of them bears its own limitations. By possessing the pros of Layer 2 solutions, such as high throughput and confirmation times, but not the cons, such as inherent dependency issues on the main chain, or additional risks and opportunity costs that come with developing new solutions, ThunderCore offers a better solution. Being a fast, high-performance EVM-compatible blockchain, it now has increased its interoperability with Binance Smart Chain, making cross-chain asset transfers possible with lightning-fast speed.

Whether it is in the eyes of individuals, institutions, or governments, the adoption of blockchains and cryptocurrencies is inevitable. But there are underlying issues, such as scalability, that inhibit such progress. This is why many blockchains deploy Layer 2 (L2) solutions. This article will introduce what L2 means, give a few examples, and explain why ThunderCore is a better solution and more viable for mass adoption.

What is Layer 2?

Layer 2 solution, also known as off-chain solution, describes a protocol that overlays on top of an original, existing blockchain. Why is a secondary network built on top of an existing one? The reason is to solve scalability and transactional speed issues. Take Ethereum (ETH) for example. It is the biggest and most established blockchain so far, but it has significant problems. When the ETH chain undergoes heavy traffic and congestion, users will become victims of high gas fees.

On top of its low transactions per second (TPS), this marks a big underlying issue for ETH by greatly affecting its ability to scale. If you can’t properly scale in the blockchain/crypto industry, your competitors will.

Layer 2 Examples: State channels and Side chains

There are 2 main types of L2 solutions: State channels and Side chains.

State channels are basically two-way channels between participants that allow them to interact with each other in a sealed-off area of a blockchain. Once the interaction is complete, the channel will then report it back to the blockchain. This solution, usually used for payment purposes, removes the need of transacting on a blockchain and the dependency on a miner, thus drastically improving the transaction speed and throughput. Bitcoin’s Lightning Network is a great example.

Side chains, as the name suggests, are secondary chains that will interact with the main chain, forming a relationship like that of a parent and a child. The main chain will then delegate certain tasks to the side chain, therefore, reducing the load for itself. The design space of side chains could be further categorized into two general categories: (1) Plasma style side chain and (2) Rollups, which comes in two flavors: optimistic and zero-knowledge.

Plasma is a generic framework for non-custodial sidechains. Each plasma chain is a smart contract designed for a specific function and can operate independently from the main chain as well. The OMG Network is a great example. However, Plasma suffers from the data availability problem hence Rollups aim to solve this issue.

Polygon (previously known as Matic Network) is another good example of an L2 solution. Polygon aims to establish itself as a platform that is able to launch and host interoperable blockchains. You can think of it as an L2 aggregator where a multitude of side chain technologies are used to solve the Ethereum scaling problem.

Why ThunderCore is Better

There are a few similarities between L2 solutions and ThunderCore. L2 is meant to provide faster transaction speed and lower gas fees; ThunderCore does just that and more. With 4,000+ transactions per second (TPS) and sub-second confirmation speed, it makes it hard to compete with even for other L2 solutions. This clear performance-centric edge makes ThunderCore the optimal space to deploy DApps, allowing developers to reap more profits due to better throughputs and cheaper costs. Along with our Jumpstart Program, developers can bootstrap their DApps to a growing base of daily active users (currently at 70K DAU) and enjoy proper exposure and awareness that is rare elsewhere.

Moreover, L2 solutions such as Plasma derive their security from the main chain (Ethereum), whereas ThunderCore is secured by rigorous mathematical proofs of the underlying consensus protocol and not dependent on Ethereum.

The key difference between ThunderCore and other L2 solutions is that we are a Layer 1 blockchain, making us impervious to dependency issues L2 solutions face. Along with our newly launched cross-chain service with Binance Smart Chain (BSC), ThunderCore now supports assets between three blockchains. With the trifecta of high-performance throughput, low fees, and interoperability, L2 solutions are no longer necessary.