The impact of blockchain has been highly influential in finance and technology for the past few years. But their working and procedures can be complicated to understand among so many categories. The concept behind the working or blockchains can be easily understood with layers.
Layers differentiate the blockchain between 0, 1, and 2 but this article is only about layer 1. So let’s discuss the meaning and importance of layer 1 blockchain. You can also diversify your crypto portfolio on this Web where you get access to trading other cryptocurrencies.
About Layer 1 Blockchain
The base of the blockchain is known to be layer 1 such as Bitcoin and Ethereum. However, it is related to the important chain of the network. Other layers of blockchains are possible after layer 1 type blockchain.
The core concept of this blockchain is to form protocols that have consensus mechanisms, structures available for the networks, security measures and features, and transaction systems as well. However, this system is easy to operate independently.
The significant elements required for Layer 1 Blockchain
To operational use the layer1 crypto chain, the essential elements required are as below:
Everybody is aware that blockchains are decentralized systems where no third-party interference is possible for transaction implementations and further verify the transaction’s authenticity.
To battle this problem, consensus mechanisms are used by the blockchains like proof of work or proof of state. Under these processes, the users take part in the transaction verification processes. As a result, a new transaction has been added to the blockchain to reward the services provided.
Blockchains are known as distributed ledgers which indicates that the public transaction log is stored on the ledger where the history of transactions was saved. As a result, the computer hardware or blockchain generates a node as the ledger is being replicated. However, the public can see and use the ledger at any time easily.
This element is used to handle data security. Since the last few years or you can say over the years, data is being saved and stored on the ledgers. The requirement of a powerful safety measuring mechanism is a must. Hence the role of blockchain is to cryptographically accomplish the task.
How Does Layer 1 Blockchain Work?
Let us suppose you are willing to make a transaction with a crypto token. However, first, you have to make a crypto wallet. The role of a wallet is to secure the storage space of the private key to connect it to the public key. Therefore, every transaction and crypto token which were owned by you is finally tied to the key.
Whenever you open the wallet for the first time, you should add some crypto tokens to it. The tokens can be further purchased through a crypto exchange so that the tokens can be shifted to the wallet itself. Another thing would be to take the public key of the receivers of your tokens. The simple step would be to input a key with the number of tokens you want to send and after that make confirmation of the transactions.
Advantages of Layer 1 Blockchains
The main attraction of blockchains is their decentralized nature for which they are popular among crypto users. However, not even a single authority is there to manipulate blockchain data.
Immutability features of layer1 blockchain
When the transaction has been executed once, it would be more difficult to reverse the process. However, the information available on the blockchain cannot be deleted or upgraded and this makes the system more reliable.
Disadvantages of layer 1 Blockchains
Although it is a funny thing that the proof of work blockchain is, however, funny for high demand consumption. Since the requirement of most powerful computers would be able to run 24/7 solving cryptographic puzzles, they also need electricity hogs. The issues can be sorted by the proof of stake blockchain.