Layer 1 (L1) blockchains are a blockchain’s main architecture which forms its on-chain network. Bitcoin, Ethereum and Solana are examples of L1 blockchains.

Layer 2 blockchains are off-chain networks built on existing L1s to increase their scalability by improving their efficiency and speed. Optimism on Ethereum and the Lightning Network on Bitcoin are examples of L2 blockchains.

Link rot is quite a prevalent problem that people underestimate the magnitude of. Due to the structure of the traditional web (Web2), as time passes, hyperlinks no longer point to the target file as it may have been moved, relocated or is no longer available. However, with the advent of the Permaweb (a Web3 application), this will no longer be a problem.

Liquidity in the NFT space refers to how easily NFTs in a particular collection can be bought and sold at fair prices. If there is high liquidity, it is fairly easy to do so. However, if there’s low liquidity, an individual can get stuck holding onto that NFT for quite some time or having to undersell.

Rarity is important within an NFT collection. Even though it implies something is of value, it is often used sarcastically. It implies the NFT may not really be as rare as the owner believes it to be.