Layer 2 Scaling
From Tari Labs
Analogous to the OSI layers for communication, in block chain technology decentralized Layer 2 protocols, also commonly referred to as Layer 2 scaling, refers to transaction throughput scaling solutions. Decentralized Layer 2 protocols run on top of the main block chain (off-chain), while preserving the attributes of the main block chain (e.g. crypto economic consensus). Instead of each transaction only the resultant of a number of transactions are embedded on-chain.
Layer 2 scaling solutions utilize an interesting approach to scale block chains while keeping them decentralized. Layer 2 solutions are protocols built “on top” of block chains and sacrifice some security in order to potentially match VISA transaction levels. Layer 2 solutions are built with the intention of keeping the user in control at all times.