Layer 1 (L1)
The foundational blockchain protocol handling consensus, security, and transaction execution, like Bitcoin or Ethereum.
What is Layer 1 (L1)?
Layer 1 (L1) blockchains are base networks executing all transactions natively, using consensus like PoW or PoS to validate blocks.
Ethereum, post-2022 Merge, uses PoS with 32 ETH staking for validators, processing 15-30 TPS at 1.5 gwei fees. Other examples include Solana (50,000 TPS via Proof-of-History), Avalanche (4,500 TPS sharding), and Polkadot (1,000 TPS parachains), with L1 market cap at $3.3 trillion in 2025. Scaling via code upgrades like Ethereum’s Dencun (2024) cuts L2 fees 90%.
L1s prioritize decentralization—Bitcoin’s 15,000 nodes—but face trilemma trade-offs, with energy use (Bitcoin: 150 TWh/year) versus speed, underpinning 70% of DeFi’s $100 billion TVL.
Related Terms
Liquidity Hook (Uniswap)
Uniswap liquidity hooks are external smart contracts in Uniswap v4 that customize liquidity addition and removal in pools, enabling developers to inject logic before or after these actions for enhanced DeFi features.
Liquidity Provider and LP Token
Entities supplying assets to DeFi pools for trading, receiving LP tokens as receipts for proportional rewards.
Pay Per Crawl
A monetization model charging for each instance of web crawling or data access.
Permissionless
A system where anyone can participate without needing approval or authorization.
OCO Order
A paired order where executing one automatically cancels the other.
UAE Stablecoin Regulation
UAE's Central Bank regulations restricting stablecoin use to licensed AED-pegged payment tokens, effective from 2025.