Layer 1 refers to the base layer of a blockchain network, which includes the core protocol and architecture responsible for transaction processing and data storage. This is the foundational layer on which all other functionalities are built.Examples of Layer 1 blockchains include Bitcoin and Ethereum. These networks handle transactions directly on their own blockchain without relying on other layers. They use their consensus mechanisms—such as proof-of-work or proof-of-stake—to validate new transactions and secure the network.Layer 1 is crucial because it sets the rules and foundation for how the network operates. It determines scalability, security, and governance features. However, Layer 1 blockchains can sometimes face limitations in scalability and speed, which has led to the development of Layer 2 solutions. These aim to enhance capacity and transaction speed without compromising the integrity of the base layer. In summary, Layer 1 forms the backbone of blockchain technology, enabling functionalities and services that other layers might build upon.