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Layer 2 (L2) is a term used in the context of blockchain networks and cryptocurrencies. It refers to a scalability solution that runs on top of an existing blockchain network, known as Layer 1 (L1), to improve its transaction processing capacity and reduce costs.

The main objective of Layer 2 solutions is to increase the scalability of the underlying blockchain network, allowing for a higher number of transactions per second and reducing processing times.

Some common features of Layer 2 solutions include:

1. _Off-chain transaction processing_: Transactions are processed off the main chain, which reduces the workload on the network and allows for a greater number of transactions.

2. _Use of smart contracts_: Layer 2 solutions often utilize smart contracts to automate the verification and validation of transactions.

3. _Interoperability_: Layer 2 solutions can allow interoperability between different blockchain networks, facilitating communication and value exchange among them.

Examples of Layer 2 solutions include:

1. _Polygon (MATIC)_: A scalability solution for Ethereum that uses a sidechain architecture to process transactions.

2. _Optimism (OP)_: A scalability solution for Ethereum that uses a rollup architecture to process transactions.

3. _Arbitrum (ARB)_: A scalability solution for Ethereum that uses a rollup architecture to process transactions.

4. _Solana (SOL)_: A high-performance blockchain that uses a proof-of-stake (PoS) architecture to process transactions.

In summary, Layer 2 solutions are a way to enhance the scalability of existing blockchain networks, allowing for a higher number of transactions per second and reducing costs.