Layer-2 (L2) networks are Ethereum scaling solutions that process transactions off-chain while using Ethereum as a security and data availability layer. For ERC20 token transfers, L2 networks offer dramatically lower fees — typically 10 to 100 times cheaper than Ethereum mainnet — while maintaining full EVM compatibility, meaning your existing ERC20 tokens and wallets work exactly the same way.
Arbitrum – Low Fees with High DeFi Adoption
Arbitrum One is an Optimistic Rollup that has become one of the largest L2 networks by total value locked (TVL). ERC20 transfers on Arbitrum typically cost $0.01 – $0.05, with complex DeFi interactions running $0.10 – $0.50. Arbitrum charges users for both L2 execution and a small portion of Ethereum L1 data posting costs. Major protocols like Uniswap, Aave, and GMX are deployed on Arbitrum.
Optimism & Base – OP Stack Networks
Optimism and Base (Coinbase's L2) both run on the OP Stack architecture. Following the Ecotone upgrade, data costs on these networks were reduced significantly. ERC20 transfers typically run $0.01 – $0.04. Base has seen rapid growth due to Coinbase integration and the ease of on-ramp from Coinbase accounts directly to Base.
After Ethereum's Dencun upgrade introduced EIP-4844 (blobs), L2 data posting costs dropped by 80–90%, pushing L2 ERC20 transfer fees below $0.01 for many transactions.
Polygon – Sidechain with Ultra-Low Fees
Polygon PoS is technically a sidechain rather than a true L2, but it offers full ERC20 compatibility with fees that are often a fraction of a cent. USDT and USDC on Polygon cost less than $0.001 per transfer. Polygon is widely used for gaming applications, high-frequency payments, and NFT platforms where mainnet fees would be prohibitive.
L2 Fee Comparison Table
- Ethereum Mainnet: $0.05 – $20+ per ERC20 transfer
- Arbitrum One: $0.01 – $0.05 per ERC20 transfer
- Optimism: $0.01 – $0.04 per ERC20 transfer
- Base: $0.005 – $0.03 per ERC20 transfer
- Polygon PoS: $0.0005 – $0.005 per ERC20 transfer
Bridging Costs to Consider
To use L2 networks, you typically need to bridge ETH and tokens from Ethereum mainnet. The bridging transaction itself incurs mainnet gas fees ($2–$15). For infrequent users making occasional large transfers, this bridging cost may not be worth it. For users who regularly transact on L2, the upfront bridge cost pays for itself quickly through fee savings.