Polkadot is a platform for interconnected blockchains that refers to itself as a meta protocol — or a “layer zero” — in the technology stack. This term isn’t widely used, nor is it widely understood, particularly by those who haven’t spent time studying Polkadot. In this article, we’ll explore the concept of a layer zero blockchain and the importance of this approach in defining the next generation of crypto networks.
First: What are Layers?
There are different parts of the blockchain architecture, each serving a unique purpose, designed to work together. Each part can be thought of as a layer. Web3 technology is built in layers for security and scalability, which requires a combination of different protocols and functions to work together. This is called the technology stack.
Blockchains begin with a genesis block and add to the blockchain by creating blocks on top of it. New transactions alter the data stored in every new block, which also contains a summary of the data that was stored in the previous block, ensuring that everything is linked. A decentralized consensus mechanism ensures that every transaction and block is valid.
This structure allows the chain to be secure, and transactions immutable, but it also causes the process to be slower when there is a lot of demand on the chain. Blockchain layers can be used to scale by separating each component of the overall blockchain architecture, so that each can be optimized and developed separately. Scaling means building in a way that allows the blockchain to complete more work, while still maintaining security.
According to the Web3 Foundation, which supports Polkadot and Kusama, there are 4 layers in the Web3 Technology Stack. In general, blockchain layers range from layer 0, the deepest foundational layer, to layer 4, which is the interface the user interacts with.
Let’s take a look at what the Web3 Foundation means when it positions Polkadot as a Layer Zero, and how that will look for users of the platform.
Sooooo… Is Polkadot a Layer 1?
No, Polkadot is not a layer 1 blockchain. Polkadot is considered a layer 0 blockchain because it serves as a “metaprotocol” upon which other layer 1s (smart contract platforms and application-specific blockchains) are deployed. More on that below.
Polkadot Layer Zero Overview
To discuss Polkadot as a layer zero (L0), it helps to know what a layer one (L1) is, because L1s are more familiar. The term layer one describes no or low-trust interaction protocols, like the blockchains that are most commonly known (e.g., Ethereum, Avalanche, Moonbeam). L2s like Arbitrum and L0s like Polkadot are also blockchains.
Layer one blockchains support all kinds of applications like DeFi and NFT Marketplaces, and L0s support the L1 blockchains. L2, L3, and L4 are built on top of the L1 and each other. So, a L0 is not a blockchain where things are built, but a blockchain platform that provides infrastructure for security for other blockchains, like L1s.
What is Layer 0? How Does a Layer 0 Work?
A layer 0 blockchain is the foundation of the tech stack made up of protocols for communication. It is the lowest level of programming that sets a standard or starting point for L1 blockchains to be built in a way that optimizes security and interoperability. This compatibility is possible because the L0 provides a common language for all the connected chains to use.
The end user almost never interacts with this layer in the stack because the L0 itself does not perform work in that way. It provides the tools used by the L1 blockchains to complete work. As an example, Polkadot does not host smart contracts, but provides the tools so “parachains” (L1s on Polkadot’s L0) can build and provide smart contracts.
Polkadot is a layer zero because it is a low-trust interaction platform for the parachains. As an interoperability protocol, Polkadot provides security via consensus to the parachains. As a consequence of this architecture, Polkadot allows blockchains to exchange messages and perform transactions without the need for an additional third party — because the layer zero serves this purpose already. Polkadot itself only performs minimal functions including security, staking, and governance.
What is a Layer 1?
Layer one (L1) blockchains are responsible for the distribution of and interaction with data. In the Polkadot ecosystem, L1 blockchains improve the base layer which is Polkadot itself. As the blockchain ecosystem grows, L1s may also scale other L1s. The parachains need Polkadot, and Polkadot needs the parachains: Polkadot provides the security and connectivity, but the activity happens at the smart contracts level on the parachains.
The end user typically doesn’t directly interact with L1s like Ethereum, Avalanche, and Moonbeam directly, but because decentralized applications and interfaces are built on top of this layer, users will often use the native network token to pay transaction fees while using these DApps. Users interact with L1s through the dApps built on top of them, for example, though the end user does not really interact with Moonbeam itself as a smart contract platform, they may still use the GLRM tokens to pay transaction fees, or use GLMR in DeFi. The names of L1 blockchains are familiar, but the end user interacts with the applications built on the L1, not the L1 itself.
L1s can serve different functions or have various priorities, like smart contract platforms, DeFi, or storage. At this layer, developers work within the base L0 (or L1) framework to design protocols to complete tasks. L1s leverage core protocols, like the EVM and WASM, but add functionality that makes it possible for developers to interact with L0s and build.
Why Layer 1s Need Layer 0s
Layer 0 blockchain protocols offer solutions to some of the challenges solo layer one blockchains encounter. A layer 0 like Polkadot provides security and other tools for all the parachains so that they can focus on developing purpose-specific or application-specific blockchains that can natively interoperate within the same consensus (Polkadot).
Historically, layer 1 (L1) blockchains have been isolated from one another which poses a challenge: They function independently and are responsible for everything they need including security, moreover, they tend to be general-purpose blockchains which can’t be optimized to tackle specific problems efficiently. Providing a blockchain with security and building everything needed for it to function is taxing for developers working on a solo layer one and can come at the cost of quality service. Additionally, overloaded blockchains running many different systems can be slow and have high transaction fees.
Layer one blockchains may want to access users, information, and tokens from other blockchains to help scale, or grow. Traditionally, the only option to do this was using a bridge to connect to other chains with more users or liquidity. Some bridging options are available to connect L1 blockchains, but these solutions are limited and sometimes unreliable.
When a layer 1 blockchain connects to a layer zero protocol like Polkadot or Kusama, a lot of these concerns are managed. Conversely, without the layer 1 blockchains build on it, a layer 0 cannot complete work. Polkadot exists independently, but gains value from the parachains that use the tools it provides and solve specialized use cases or offer meaningful end-user applications.
Blockchain Layers Landscape: L1s as Islands
With the exception of the Kusama and Polkadot parachains, most chains are solo — meaning they manage their own security along with everything else. Ecosystems like Cosmos have hubs that serve a similar purpose, but differ from Polkadot in their architecture.
Imagine these solo L1 blockchain networks as islands:
- They have their own languages and currencies and each community governs itself.
- Bridges can be built to connect the islands together, but many factors can affect the stability and use of the bridge.
- Communities from different islands might speak different languages and have different customs, complicating interactions.
- Moving along a bridge can be restrictive when trying to transfer items between the islands.
- Communication and movement between the islands is possible but sometimes difficult and unreliable.
Polkadot connects parachains securely without the need for bridges.
As L1s based on Polkadot’s L0 blockchain, parachains are like houses in a Polkadot neighborhood connected by roads.
- In the Polkadot neighborhood, The roads are the shared security and communication routes between blockchains that can be used for governance and other means. Polkadot is the government responsible for maintaining the roads, and catching bad actors, like the police.
- Everyone in the community speaks the same language and abides by the larger rules of the community which keeps everyone safe.
- Parachain households are free to make their own house rules
- Parachains can build shortcut pathways to neighboring houses they want direct access to other parachains via “roads” that Polkadot facilitates.
The Relay Chain of Polkadot is like the foundation underneath the L1 blockchains, connecting them securely and allowing them to share the security of the whole ecosystem. The communication between blockchains is provided by Polkadot protocols like XCMP. XCMP is a cross-consensus messaging protocol developed by Polkadot that is used by parachains that can also be extended for use to outside blockchains.
In the analogy, Polkadot would be a foundation that runs underneath the parachains, like the land on which the parachains communities are built. Polkadot maintains the roads and other infrastructure so the households don’t need to.
The Polkadot decentralized infrastructure securely connects the parachain households to allow more simple and reliable movement between them. These connections are direct and can accommodate a variety of payloads. You can move both ways, and carry heavy or oddly shaped items (like data, NFTs, and tokens) independent of weather conditions, traffic, or the stability of the blockchains themselves.
Polkadot is designed as a large community, so the parachains work together for the good of the entire ecosystem because they all benefit from more security and options for cross-chain interoperability, while maintaining their sovereignty via their own tokens, validators, and governance.
Polkadot as an Interoperability Hub
Polkadot sets out to facilitate a truly decentralized internet of blockchains that are natively interconnected as a base layer that supports layer 1s. This means that while the L1 blockchains on Polkadot can govern, build, and maintain whatever features they want, they are connected by the Relay Chain of Polkadot. This native interconnectedness results in the following benefits:
There are no smart contracts on Polkadot; instead, all smart contracts exist on the parachains. This leaves Polkadot free to focus on message passing and security, leaving parachains to serve as scalable solutions.
Polkadot itself focuses only on its foundational work as a layer zero. Allowing specialization of protocols like layer 1 blockchains makes the parachains heterogeneous. Other L1 blockchains have to juggle their security and use DApps to scale, but Polkadot and its specialized blockchains (the parachains) work together.
Each parachain has the autonomy to customize its design to optimize for particular use cases or applications. This allows teams to focus on their goals without having to spend energy on other aspects of blockchain technology, like security. This means that, though connected, parachains can specialize in one feature, like storage, privacy, or smart contracts, and do that one thing better than if you had to maintain their security (and storage, privacy, and smart contracts) as well.
Since all parachains are built on a framework called Substrate and connect to Polkadot’s architecture, they can natively communicate, trade assets, and form rich cross-chain interactions and connections. Polkadot’s XCM (cross-consensus messaging) format, features XCMP which allows parachains to interact with each other (without using the Relay Chain) to share assets, and more.
All runtime upgrades are put to an open on-chain vote, so no rogue factions are running alternate versions of the chain. On Polkadot, code is law and is enforced through on-chain votes.
Cross-Chain Connected Smart Contracts
The latest Polkadot and L1 Moonbeam upgrades allow for a new level of interoperability for the Polkadot ecosystem. Connected contracts leverage the security of the Relay Chain, and use Polkadot’s XCM and external general message passing to communicate across remote blockchains. This ability extends the interoperability of the parachains to external independent blockchains like Ethereum, Avalanche, and Cosmos.
Cross-chain applications like these represent a shift toward usability by allowing end users to couple any token with functionality located on any blockchain, all in the context of a single application user experience. This ready availability of inter-blockchain communications will change Web3 development by producing more efficient protocols with superior user experience.
Why Build a Layer 1 on Polkadot Layer 0?
In the context of the Web3 technology stack, Polkadot has become a notable example of a layer zero. Layer zeros are the foundation of the technology stack consisting of how blockchains can communicate and how they can be programmed at the lowest level. As blockchain technology develops, new use cases and possibilities for interoperability and communication come to light. Solo chains face new challenges when user adoption increases, making ecosystems built to manage these developments more appealing.
Though it was created after layer ones like Bitcoin and Ethereum, Polkadot, along with its parachains, introduces a key foundational piece that will become the structure of the interoperable future of Web3.