Layer 2 Comparison: Arbitrum vs Base vs Optimism vs Lightning vs Spark

What Are Layer 2 Solutions?

Layer 2 (L2) solutions are protocols built on top of a base blockchain (Layer 1) that process transactions off the main chain while inheriting some or all of its security guarantees. The core motivation is simple: Layer 1 blockchains like Bitcoin and Ethereum have limited throughput. Bitcoin processes roughly 7 transactions per second; Ethereum handles about 15 to 30. As demand grows, fees rise and confirmation times slow down.

L2s solve this by moving the bulk of computation and data off-chain, then anchoring the results back to the base layer. This approach preserves decentralization and security while dramatically increasing capacity, reducing fees, and speeding up transactions. The tradeoffs between different L2 architectures center on how much security they inherit, how they handle data availability, and what trust assumptions users must accept.

The table above compares the leading L2 solutions across both Bitcoin and Ethereum ecosystems, covering fees, speed, TVL, security model, and primary use cases.

Ethereum L2s Compared

Ethereum's L2 ecosystem is the most developed in crypto, with over $30 billion in combined TVL across dozens of rollups. The dominant architectures are optimistic rollups and ZK (zero-knowledge) rollups, each with distinct tradeoffs.

Arbitrum One holds the largest share of Ethereum L2 TVL, driven by its deep DeFi ecosystem including protocols like GMX, Aave, and Uniswap deployments. Base has grown rapidly thanks to Coinbase's user distribution and a focus on consumer applications. Optimism pioneered the OP Stack, which Base itself is built on, and is pursuing a "Superchain" vision where multiple OP Stack rollups share infrastructure and interoperability.

ZK rollups like zkSync Era, Starknet, and Polygon zkEVM use mathematical proofs to verify transaction validity instead of relying on a challenge period. This offers faster finality in theory, though practical proving times and ecosystem maturity are still catching up to optimistic rollups.

Bitcoin L2s Compared

Bitcoin's L2 landscape differs fundamentally from Ethereum's. Bitcoin lacks a Turing-complete smart contract layer, so L2 solutions use alternative architectures: state channels, federated sidechains, and statechains.

The Lightning Network is the most established Bitcoin L2, enabling instant, low-cost payments through a network of bidirectional payment channels. Users lock BTC into channels and can route payments across the network without touching the base layer. The tradeoff is that users need channel liquidity and must manage channel state.

Spark takes a different approach using statechain technology with FROST (Flexible Round-Optimized Schnorr Threshold) signing. This enables free, instant transfers of Bitcoin and stablecoins like USDB without requiring payment channels or liquidity management. Spark is designed for both payments and stablecoin use cases on Bitcoin.

The Liquid Network is a federated sidechain operated by a consortium of functionaries. It offers confidential transactions and faster block times (2 minutes vs Bitcoin's 10 minutes), but security depends on the federation rather than the full Bitcoin network.

L2 Architecture Types

Understanding the architecture behind each L2 helps explain the security and performance tradeoffs.

Optimistic Rollups

Optimistic rollups (Arbitrum, Optimism, Base) assume transactions are valid by default and only verify them if someone submits a fraud proof during a challenge window (typically 7 days). This makes them simpler to implement and fully EVM-compatible, but introduces a withdrawal delay when moving assets back to L1. Security derives from the underlying Ethereum chain: as long as at least one honest validator exists to submit fraud proofs, the rollup remains secure.

ZK Rollups

ZK rollups (zkSync Era, Starknet, Polygon zkEVM) generate cryptographic proofs that mathematically verify the correctness of every batch of transactions. No challenge period is needed because the proof itself guarantees validity. This enables faster finality and stronger security guarantees. The tradeoffs are higher computational costs for proof generation and, in some cases, reduced EVM compatibility (especially for STARK-based systems like Starknet, which use a custom language called Cairo).

State Channels

State channels (Lightning Network) allow two parties to transact off-chain by locking funds in a multisig contract on L1. Transactions happen instantly between participants, and only the opening and closing transactions are recorded on-chain. The Lightning Network extends this concept into a network of channels, enabling payments to route through intermediaries. Security is enforced by the ability of either party to broadcast the latest channel state to the base chain.

Statechains

Statechains (Spark) transfer ownership of UTXOs off-chain using collaborative signing between the owner and an operator using FROST threshold signatures. The previous owner cryptographically loses the ability to spend the UTXO when ownership transfers, eliminating the need for on-chain transactions. This architecture enables free transfers with no gas fees, making it particularly suited for high-frequency payments and stablecoin transfers on Bitcoin.

Federated Sidechains

Federated sidechains (Liquid Network) operate as independent blockchains with a fixed set of validators (functionaries) who manage the two-way peg to the base chain. Users lock BTC on Bitcoin and receive an equivalent token (L-BTC) on the sidechain. Security depends on the honesty of the federation rather than cryptographic proofs or the full Bitcoin network, making this the weakest security model among L2 types but still useful for specific trading and privacy use cases.

How to Choose an L2

The right L2 depends on what you are building or what you need to do. Here is a practical framework:

If you want DeFi on Ethereum: Arbitrum One has the deepest liquidity and widest protocol support. Most major DeFi protocols have deployed there, and it consistently leads in L2 TVL.

If you are building consumer apps: Base offers the best distribution through Coinbase's user base, low fees via EIP-4844 blob data, and a growing ecosystem of consumer-facing applications.

If governance and ecosystem alignment matter: Optimism's retroactive public goods funding model and Superchain architecture attract projects that value collective governance and shared infrastructure.

If you need privacy or advanced cryptography: zkSync Era and Starknet offer the most advanced ZK capabilities, including native account abstraction and the potential for private transactions.

If you want instant Bitcoin payments: Lightning Network is the proven choice for BTC-denominated payments, with wide wallet and merchant support.

If you want free stablecoin transfers on Bitcoin: Spark enables instant, zero-fee transfers of both BTC and USDB without managing payment channels, making it the simplest option for Bitcoin-native stablecoin payments.

The Future of Layer 2

The L2 landscape is evolving rapidly. On Ethereum, the trend is toward a "rollup-centric" roadmap where the base layer serves primarily as a data availability and settlement layer, with most user activity happening on L2s. EIP-4844 (proto-danksharding), which went live in early 2024, dramatically reduced L2 fees by introducing blob data. Future upgrades like full danksharding will increase data availability further.

Interoperability between L2s remains a challenge. Users currently face friction when moving assets between Arbitrum, Base, and Optimism, though projects like the Superchain (shared bridging across OP Stack chains) and cross-rollup messaging protocols aim to reduce this friction.

On Bitcoin, the L2 ecosystem is earlier in development but growing fast. Lightning has established itself for payments, and newer approaches like Spark are expanding what is possible on Bitcoin by supporting stablecoins and other token types natively. As demand for Bitcoin-based financial products grows, Bitcoin L2 competition is likely to intensify.

The long-term trajectory is clear: most blockchain activity will happen on L2s, with base layers providing security and settlement. Choosing the right L2 today means understanding the tradeoffs between security models, fee structures, ecosystem maturity, and the specific use cases each solution targets.

Frequently Asked Questions

What is a Layer 2 blockchain?

A Layer 2 is a protocol that operates on top of a Layer 1 blockchain (like Bitcoin or Ethereum) to increase transaction throughput, reduce fees, and improve speed. L2s process transactions off the main chain while anchoring security back to the base layer through various mechanisms: fraud proofs (optimistic rollups), validity proofs (ZK rollups), channel states (Lightning), or collaborative signing (Spark).

Which Layer 2 has the lowest fees?

Spark offers free transfers on Bitcoin with no gas fees. Among Ethereum L2s, Base and Starknet consistently have the lowest fees, often under $0.05 per transaction. Lightning Network fees are also extremely low, typically less than $0.01 per payment. Exact fees on all L2s vary with network conditions and the type of transaction being performed.

Is Lightning Network a Layer 2?

Yes. Lightning Network is a Layer 2 payment channel network built on Bitcoin. It enables instant, low-cost Bitcoin transfers by creating off-chain payment channels between users. Only channel opening and closing transactions are recorded on the Bitcoin base layer, while all intermediate payments happen off-chain.

What is the difference between optimistic and ZK rollups?

Optimistic rollups assume transactions are valid and use a 7-day challenge period during which anyone can submit a fraud proof to contest invalid transactions. ZK rollups generate mathematical proofs that verify every transaction batch is correct, requiring no challenge period. Optimistic rollups are simpler to build and more EVM-compatible; ZK rollups offer faster finality and stronger security guarantees but are more computationally intensive.

What is Spark and how does it compare to Lightning?

Spark is a Bitcoin Layer 2 that uses statechain technology with FROST threshold signatures to enable free, instant transfers. Unlike Lightning, Spark does not require users to open and manage payment channels or worry about inbound liquidity. Spark also supports stablecoins (USDB) natively, while Lightning is primarily used for BTC payments. Both are instant, but Spark eliminates gas fees entirely.

What is TVL and why does it matter for L2s?

TVL (Total Value Locked) represents the total value of assets deposited in an L2 protocol. It serves as a proxy for adoption and trust: higher TVL generally indicates more users, deeper liquidity, and greater confidence in the protocol's security. However, TVL alone does not tell you about actual usage volume, revenue, or the quality of applications built on the L2.

Can I use multiple Layer 2s at the same time?

Yes. Many users actively use multiple L2s for different purposes: one for DeFi, another for payments, another for gaming. The main friction is bridging assets between L2s, which can take time (especially the 7-day withdrawal from optimistic rollups to Ethereum L1) and incur bridge fees. Cross-L2 bridging solutions are improving, but moving between ecosystems still requires planning.

Are Layer 2 solutions safe?

L2 security varies by architecture. Rollups that post data to Ethereum inherit its security guarantees, making them the strongest model. Federated sidechains like Liquid depend on the honesty of their federation members. State channels (Lightning) and statechains (Spark) are secured by the underlying Bitcoin blockchain combined with cryptographic mechanisms that prevent fraud. Every L2 introduces some trust assumptions beyond the base layer. Users should understand the specific security model of any L2 they use.

This tool is for informational purposes only and does not constitute financial advice. L2 data including TVL, fees, and speeds are approximate and based on publicly available information as of early 2026. Network conditions, TVL, and fee structures change frequently. Always verify current data before making decisions.