Yes, COTI is a Layer 2, but not the usual kind. When people think of Layer 2s, they usually picture rollups focused on speed and gas savings. COTI doesn’t compete with those. Instead, COTI V2 is a privacy-focused Layer 2 on Ethereum, designed specifically to handle confidential computation. That means it doesn’t just help Ethereum scale, it helps it do something new: run encrypted logic on-chain.
COTI V2 uses garbled circuits, a cryptographic method that allows smart contracts to process inputs without revealing them. It's not ZK rollups, it's not optimistic rollups, it's a different lane entirely. Think of it as an encrypted execution environment sitting on top of Ethereum.
Here’s what makes it Layer 2:
- It inherits Ethereum’s security
- It settles back to Ethereum
- It’s compatible with Ethereum wallets, tooling, and token standards
- It extends Ethereum’s capabilities without replacing it
And here’s what makes it different:
- It’s built for confidentiality, not just cost or throughput
- It introduces computation fees paid in COTI instead of just ETH
- It prioritizes use cases that require privacy, like private DeFi, on-chain AI, or institutional data handling
COTI was previously a Layer 1 called Trustchain, which focused on payments. That infrastructure is now legacy. With the V2 launch, the project has fully repositioned as a modular Layer 2 for privacy, tied closely to Ethereum’s future but filling a gap that most other protocols aren’t even targeting yet.
So yes, COTI is a Layer 2 but don’t confuse it with just another rollup. It’s playing a different game.
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