Layer 1 is the term for a blockchain that runs its own consensus and settles its own transactions directly, without relying on another chain underneath it. Bitcoin is an L1. Ethereum mainnet is an L1. Solana, Avalanche, Cardano, Cosmos Hub, NEAR, Sui, and Aptos are all L1s. The defining characteristic is that the chain is standalone — it has its own validators or miners, its own block production, its own security budget, and its own native token used to pay transaction fees. If the network disappeared, there would be no chain underneath to fall back to.
The contrast is with Layer 2, which is a system built on top of an L1 that inherits the L1’s security. Arbitrum, Optimism, and Base are L2s built on Ethereum. The Lightning Network is an L2 built on Bitcoin. L2s offload execution from the base chain to reduce costs, then periodically anchor their state back to the L1. The architectural split — L1 as secure settlement, L2 as fast execution — is now the dominant way of thinking about scaling for Ethereum, though it is contested in other ecosystems.
What L1s Compete On
All L1s are making the same basic promise: a globally replicated, programmable, cryptographically secured ledger. They differ on the tradeoffs they make in delivering it. Bitcoin optimises for security and predictability at the cost of expressiveness and throughput; its scripting language is intentionally limited and its block time is intentionally slow. Ethereum optimises for programmability and a large developer ecosystem at the cost of base-layer throughput; the base chain handles around 15-20 transactions per second and pushes high-frequency activity to rollups. Solana optimises for throughput and low fees at the cost of higher hardware requirements for validators and, historically, occasional network outages during periods of congestion. Cosmos-family chains optimise for sovereignty and interchain composition at the cost of being a fragmented ecosystem with weaker shared security.
None of these tradeoffs is obviously right or wrong. They reflect different bets about what blockchains are going to be used for and what properties users actually care about. In practice, the L1 market has settled into a pattern where Ethereum dominates the “smart contract platform” category by most measures (TVL, developer activity, token count) and a handful of alternatives occupy meaningful secondary positions.
The “Ethereum Killer” Cycle
Every cycle produces a new crop of L1s positioned as the Ethereum killer. In 2017-2018 it was EOS, NEO, and Cardano. In 2020-2021 it was Solana, Avalanche, Fantom, and Terra. In 2023-2024 it was Sui, Aptos, and Berachain. The pitch is always roughly the same: we are faster, cheaper, and better-designed than Ethereum, and we are going to win on fundamentals. In practice, none of them have displaced Ethereum from its position at the centre of the DeFi and NFT ecosystems, though several have carved out real niches (Solana for consumer apps and memecoins, Cosmos for app-chains, Avalanche for subnets).
The reason Ethereum has been so hard to dislodge is that developer gravity, tooling, liquidity, and standards are all self-reinforcing. Building on Ethereum gets you access to EVM-compatible infrastructure, a deep pool of DeFi protocols, the biggest developer community, and the most mature wallet and exchange support. Starting over on a new chain means rebuilding all of that, and even a chain with clearly better raw performance has a hard time overcoming those network effects in practice.
The Chain-Agnostic Future
One emerging view is that the L1 wars are less important than they seemed in 2021. Cross-chain bridges, wallet abstraction, and rollup ecosystems are making the specific L1 a transaction settles on less visible to end users. If your wallet can hold assets across five chains and a swap aggregator routes your trade through whichever one gives the best price, you may not know or care which L1 you are using for a given action. In that world, L1s become commodity settlement substrates competing on price and security rather than on brand. Whether this is the actual future is unclear, but the direction of travel is toward more chain-agnosticism, not less.