Since the majority of us were not born with the latest level of technological development, having trouble grasping technical concepts is not something to be ashamed of. As a member of the Hydro community, I kept hearing “layer 1, 2, 3, 4” and, though I thought I understood, when I tried to explain the layers my thoughts were scattered and I struggled to understand the full picture. That was why I decided to take one of the “Who wants to be a millionaire” options and ‘phone a friend’. After the call I believe I can now fully differentiate between the layers, and it is time to help others who are struggling to understand these terms.
Layer One – Ethereum
The first layer is Ethereum, it is on this layer that all ERC contracts, tokens and dApps are built. This layer is also often referred to as the base layer.
Layer Two – Hydro
All hydro protocols, including Raindrop, Snowflake, Ice, Tide and Hail, constitute layer two. Layer two is made up of the protocols that utilize layer 1 to achieve functionalities related to identity (Snowflake), file system management (Ice), authentication (Raindrop) etc. These layer two functionalities enable the creation of powerful dApps and Apps.
Layer Three – dApps
Layer three is made up of dApps and Apps built on the layer two protocols. An example of a dApp built with Hydro would include a dApp store which uses ERC1484 (an identity protocol) and Snowflake (for identity-linked payments and resolvers). Other examples include an ownership dApp (using Snowflake identity), Hydro Drive (Snowflake and Ice), and Hydro Pay (Snowflake and Tide).
Layer Four – Companies such as Hydrogen
Layer four is people or companies who are building on top of layer one infrastructure, layer two protocols, and layer three dApps . These companies or projects might use some of the dApp smart contracts (layer three), some protocols (layer two), other Ethereum functionality, or a unique combination of the above layers. By doing so, companies can seamlessly leverage powerful blockchain functionalities within existing systems, or quickly build their systems from scratch on Hydro.
Layer 1 = Ethereum
Layer 2 = Protocols like Hydro
Layer 3 = dApp and App interacting with Layer 2
Layer 4 = Companies building products to utilize layer 3,2,1.
Now that we both understand (lolz), it is time for you to decide what type of dApp is right for your project and we are always here to help.