What Is Layer 3 in Blockchain? Top 5 Layer 3 Projects to Watch (2025 guide)

Why Layer 3 Is the Next Big Thing in Blockchain

Understanding Layer 3 Blockchain:

Layer 3 blockchain is built on the base infrastructure of Layer 1 and layer 2 blockchain that aims to provide scalability and compatibility, With existing infrastructure, the key difference between layer 2 and layer 3 lies in their focus area: The goal of layer 2 is to enhance the performance of a single blockchain, while layer 3 focuses on improving reach and capabilities.

The concept of Layer 3 comes from the need for more secure and scalable blockchain network. It’s more about connecting different Blockchains and to facilitating the seamless communication between them, stands out as connection between new user and Web 3 projects.

Key Features of Layer 3 Scaling Solutions

User Interfaces (UI) and User Experience (UX)

Layer 3 provides a platform for decentralized applications to operate with more efficiency and scalability. It act as a bridge between the new technology and daily user, making dApps more accessible which is an essential step toward mainstream adoption.

Interoperability Protocols

Interoperability is a key component in blockchain technology especially in Layer 3, without it, blockchain would remain isolated and will have limiting their potential for development and collaboration.

For example: Hyperlane is an L3 protocol that focuses on permissionless interchain communication for rollups.

Application-specific protocols:

L3 is designed to serve single case or category such as Social media, gaming, or DeFi rather than serving as a general platform.

Layer 3 primarily focuses on one use case to optimize the performance, enhance user experience, and provide tailored features that meet the unique needs.

Layer 1 vs. Layer 2 vs. Layer 3 Blockchain Scaling Solutions

• Layer 1 is the base and the foundational layer of the blockchain.

• Layer 2 is built on the top of Layer 1 and primarily aim for scalability and compatibility.

• Layer 3 is also build on both layer 1 and layer 2, host decentralized applications and executes tasks.

Layer 3 blockchain functions

Some of the main function of layer 3 are as follow;

Improving user experience:

Layer 3 simplify the blockchain and user interaction with real world applications.

For example: zkLogin allow user’s access blockchain applications with a Google or Apple account, removing the need for wallets or seed phrases.

Interoperability between blockchain networks:

L3 act as a connection with other layer for better user experience and also allowing apps to interact across the ecosystem.

For example: Layer 3 social app could allow users to mint NFTs on Ethereum while using assets from Solana.

Enhanced security and privacy:

L3 ensure the security and privacy of user’s data by using encryptions or zero knowledge proof.

For example: Healthcare dApp could run on a Layer 3 that keeps sensitive medical information private, even from the underlying chain.

What is Zero knowledge proof?

Zero knowledge proof allow you to prove something is true without revealing the specific details of that truth.

Imagine proving you know a secret password to unlock a safe, but you don't want to tell anyone the password. ZKP let you do this by providing a proof of knowledge without disclosing the knowledge itself.

Customization and flexibility:

L3 is flexible and also customizable, where tailored features can be added in decentralized applications without any changes in L1 and L2.

Top 5 Layer 3 Projects to Watch in 2025

There are some layer 3 projects which can be on upward run in 2025, which are as follow;

1. XAI Network – Web3 Gaming Made Easy:

Xai is the first layer3 in the arbitrum ecosystem. Xai network support gamer and provide them open platform for interactions and also for game in trade item with connecting it to their vault,

Primarily focus on scalability, Low fees, wallet interaction hurdles and stability.

Price of Xai is still very low and chances for the big returns are very high in coming years.

Price: $0.06143

2. Orbs – Infrastructure for L3 dApps:

L3 blockchain infrastructure especially designed for the advance on chain trading. Orbs are improving the technology to know the aggregate liquidity and pre-trading orders. It is also compatible with EVM (Ethereum virtual machine) and also help in data processing.

This coin is in very low price, it will be a wise investment for long term.

Price: $0.02135 USD

3. Degen Chain – The Fun Side of Layer 3

Degen token is L3 token on Ethereum blockchain, started as a meme but now is now a community token of the Warpcast decentralized social media platform built on Farcaster.

The main features of this network is low transaction fee and community growth.

Price: $0.002994

4. ZkPorter – Layer 3 by zkSync

Basically it’s a layer 3 scaling solution it operate on the top of layer 2 to offer more functionalities and improvements. It is considered as a potential platform for smart contracts, secure data with Interoperability and zero knowledge execution. It is designed to optimize target use cases like privacy-preserving DeFi, enterprise data sharing, and healthcare data interoperability.

Price: $0.06352

5. StarkEx App Chains – Power for Institutions

It is a project on layer 3 blockchain, provides more customization options for dApp builders and promising very lower transactional cost. Starknet Appchains optimize performance, enhance throughput, and enable powerful tailored solutions for decentralized applications.

Price: $0.1469 USD

Layer 3 in blockchain is building the way for ultra-scalable, app-specific solutions that can finally bring Web3 to the masses. By building on top of Layer 2, it offers faster, cheaper, and more customizable experiences for developers and users alike. From gaming to DeFi and social apps, the top Layer 3 projects in 2025 are redefining how we interact with blockchain technology. As the crypto space evolves, understanding the role of Layer 3 is crucial for investors, builders, and enthusiasts. Stay ahead of the curve by keeping an eye on these game-changing Layer 3 innovations.

In project like these, those who invest early earn more, so don’t waste your time, start researching your investment opportunities today.

FAQs

1. What is Layer 3 in blockchain technology?

Layer 3 is the third layer in blockchain architecture, built on top of Layer 1 and Layer 2. It focuses on enhancing user experience, scalability, interoperability, and customization for decentralized applications (dApps).

2. How is Layer 3 different from Layer 2?

While Layer 2 improves scalability for a single blockchain, Layer 3 focuses on enabling cross-chain communication, better user interfaces, and app-specific performance for use cases like gaming, DeFi, and social media.

3. Which are the top Layer 3 blockchain projects to watch in 2025?

Some promising Layer 3 projects include XAI Network (Web3 gaming), Orbs (on-chain trading), Degen Chain (community-focused), zkPorter (privacy & scalability), and StarkEx App Chains (enterprise-grade dApps).

Be early. Be smart. Be informed. Join us now!