Layer 2

A layer 2 bundles hundreds of transactions and records them on Ethereum as a single one, which spreads the cost among them. Networks that work this way are often called rollups, and come in two kinds: optimistic rollups assume a transaction is valid unless someone proves otherwise, and zero-knowledge rollups post a proof that it is. ethereum.org lists Base and Arbitrum One among the layer 2s it follows.

For someone holding digital dollars on a layer 2, three things follow:

• The address is the same. Base and Arbitrum use Ethereum’s address format, so an ordinary wallet has the same address there as on Ethereum.
• Fees are paid in ETH. Both charge their network fees in ETH, not in the token you send, so moving digital dollars there takes a little ETH on that network.
• Final takes as long as on Ethereum. Circle, which issues USDC, treats a transfer there as final only once Ethereum’s own blocks confirm it, 15 to 19 minutes later.

A layer 2 also depends on its sequencer, the part that receives transactions and puts them in order, and when it fails, the network can stop. In June 2026, according to The Block, an invalid block choked Base’s sequencer and stopped the network for about two hours, interrupting withdrawals, and it stalled again the next day. Base said no user funds were at risk: what a halt costs is time.

And ethereum.org’s own caution applies: no layer 2 is as tested as Ethereum itself.

The guide on sending and receiving digital dollars covers transfers on layer 2s, and bridged token the copies of digital dollars that some of them carry.