What are Layer-0 protocols?

• Layer-0 protocols are the foundational infrastructure upon which Layer-1 blockchains are built.

• They aim to address the challenges of scalability, interoperability, and developer flexibility in the blockchain industry.

• Notable examples of Layer-0 networks include Cosmos, Polkadot, and Avalanche.

Layer-0 protocols form the foundation upon which Layer-1 blockchains are constructed. They serve as the infrastructure for blockchain networks and applications, aiming to address industry issues such as scalability and enabling interoperability between blockchains. Layer-0 protocols enable developers to launch customised Layer-1 blockchains designed for specific applications or use cases. With the support of Layer-0s, developers can focus on applications instead of consensus and security.

Several Layer-0 protocols adopt a relay/sidechain-based infrastructure, which mainly consists of three components. A mainchain supports the data transfer between Layer-1s, while sidechains are application-specific Layer-1s connected to the mainchain. The interchain communication protocol acts as a standard for data exchange amongst the Layer-1s. Cosmos, Polkadot, and Avalanche are notable examples of Layer-0 networks that use this relay/sidechain structure.

Layer-0 protocols aim to allow Layer-1 blockchains to communicate and interoperate, striving to provide users with a seamless experience across multiple networks. Without the interoperability solutions provided by Layer-0 networks, individual blockchains would largely operate in isolation. This limits their utility and hinders the networking effects that arise when systems cannot communicate and interact with each other.

In the coming years, Layer-0 protocols may contribute to future blockchain developments by enabling the growth of multiple specialised Layer-1 blockchains that interoperate seamlessly. This could lead to a more tightly interwoven network of blockchain-enabled products and services, aiming to enhance user experience.

Layer-0 protocols aim to address the "blockchain trilemma" - the challenge developers face in creating a blockchain protocol that is decentralized, secure, and scalable without any trade-offs made between all three aspects. By creating a more flexible base infrastructure and allowing developers to launch their own purpose-specific blockchains, Layer-0 protocols aim to address challenges such as scalability and interoperability.