Layer 2 scaling solutions like the Lightning Network enable faster and cheaper Bitcoin transactions by moving some transactions off the main Bitcoin blockchain. Instead of every transaction being recorded on the main blockchain, the Lightning Network allows users to create payment channels directly between each other. This means that transactions can be processed off-chain, enabling instant transactions with lower fees since they do not need to be confirmed by the entire network. As a result, the Lightning Network can significantly increase the transaction speed and reduce the cost of making Bitcoin transactions.
