Bitcoin (BTC) has transformed the financial sector with its decentralized, secure, and transparent characteristics. While Bitcoin was the first cryptocurrency, Ethereum (ETH) led the way in developing the decentralized finance (DeFi) ecosystem. Now, Bitcoin is also entering a phase of growth within its own ecosystem. As Bitcoin’s popularity increased, so did the challenges surrounding its scalability and transaction speed. To tackle these issues, the Bitcoin community has created various layer-2 blockchains (L2s) to enhance the network’s efficiency and functionality without making changes to Bitcoin’s software itself. This article explores the concept of Bitcoin layer 2s, discussing their types, advantages, and anticipated advancements in this field. By grasping these innovative protocols, users can understand how Bitcoin is evolving and staying relevant in a competitive digital landscape. Ultimately, Bitcoin is considered the digital equivalent of gold, around which an entire economy is emerging, much like gold in the physical world.
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