Layer-1 and Layer-2 Explained

You may be pretty well-versed in blockchain and cryptocurrencies, but perhaps new to the concept of Layer 2 scaling solutions, NFTs, and marketplaces! 


Layer-1 is the term we use to describe the underlying main blockchain that we're building on. In the case of Immutable X, and (by extension) Guild of Guardians, our Layer-1 is the base Ethereum blockchain network. Transfers of ETH from wallet to wallet take place on Layer-1 of the Ethereum blockchain.


Layer-2 is the term we use to describe secondary networks built on top of the main Layer-1 blockchain. Commonly referred to as 'Layer-2 Scaling Solutions', these Layer-2 networks have primarily been established to solve a scalability problem within the Layer-1 protocol. The main purpose of Layer-2 is in shifting the transaction load off of the Layer-1 blockchain protocol and over to off-chain Layer-2 architecture.

As an example, this means that the main Ethereum network would not experience performance losses or be adversely affected during periods of high transaction volumes taking place across a Layer-2 protocol. It also means that the gas fees associated with and burned by the Ethereum blockchain are significantly less when going through Layer-2 solutions than they would be if the high volume of transactions were each individually committed directly to Layer-1.

How does this affect me?

It doesn't, unless of course, you would prefer higher gas fees! By using the Immutable X Marketplace on Layer-2, gas fees are covered entirely by the marketplace fee, regardless of the value of the transaction.

What this does mean for you, however, is that you will be trading assets on a Layer-2 protocol, Immutable X. If you are trading within our marketplace ecosystem from user to user, or buying and selling on the marketplace, you will not have any need to move those assets back down to the Ethereum blockchain Layer-1.

If you wish to withdraw funds or assets from your IMX wallet (Layer-2), or transfer to another user not using the same Layer-2 protocol, you will first need to transfer those assets down and back onto the Ethereum blockchain Layer-1 - please note, there will be gas fees to move assets from Layer-2 down to Layer-1.

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