Layer 0
Commonly referred to as the “invisible layer”, it consists of hardware underneath, the Internet, and communication protocols used by blockchains.
Some examples of technologies that exists on this layer include Polkadot, Cosmos and Avalanche. These tools helps to share data seamlessly through different blockchain networks
Layer 0 aims to ensure interoperability between multiple different blockchains
Layer 1
This is the base protocol, the core of the blockchain network. It includes the primary protocols responsible for consensus mechanisms, transaction validation and security.
Some examples of popular blockchains include: Bitcoin, Ethereum and Solana
Cryptocurrencies vs Tokens
There is a common misconception between crypto currencies and tokens. Cryptocurrencies are assets that operates on its own independent blockchain, examples include bitcoin, ethereum and solana
Tokens are assets that are built on top of an exisitng blockchain, examples include Uniswap, USD Coin and Chainlink that are built on the ethereum blockchain
Layer 2
These are solutions that are build on top of layer 1 blockchains to enhance scalability and transaction speed.
They do this by handling the transactions off the main chain, reducing congestion and fees while still benefiting from the security of the underlying layer 1.
Some examples include: Polygon(for ETH), Optimism, Arbitrum
Layer 3
The application layer, where applications are run to interact directly with users.
This usually includes dApps, user interfaces and other tools that provide specific functionalities
Example: Uniswap (DeFi), OpenSea (NFTs), MetaMask (Wallet)