Layer 2

Definition

Layer 2 (L2) refers to protocols built on top of Bitcoin's base layer (the main blockchain) that delegate security to the L1 but process transactions faster, more cheaply, or with extended functionality. The canonical example is Lightning Network, which opens off-chain payment channels for instant transfers of sats. Other L2s under development include rollups such as Citrea or BitVM, and sidechains such as Liquid and Rootstock. For corporate treasuries, L2s open up productive use cases on top of the BTC balance sheet (collateralized lending, on-chain yield) without having to leave the main network.