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To understand Layer 1 blockchains, it’s important to first learn how blockchain scaling works. To maintain a blockchain’s security and functionality, there are thousands of nodes working around the clock to process transactions. To handle such large numbers of transactions, large volumes of data must be stored and shared across all nodes.
To compete with traditional payment processing systems, blockchain networks need to be highly scalable. For instance, the Bitcoin and Ethereum networks can process between 5 and 30 transactions per second (TPS). Visa, on the other hand, can process a staggering 24,000 TPS with its VisaNet electronic payment network. Developers are working on multiple methodologies to improve the scalability of these blockchain networks.