The Crypto CFO Playbook for Navigating Blockchain’s 3 Layers

For years, “blockchain,” and “crypto,” have been treated as a singular proposition. Companies were assumed to be either “in” or “out,” believers or skeptics.

That binary framing was convenient during the early years of experimentation, when the technology was mostly operating offshore and was associated with speculation.

It is no longer useful as the blockchain sector starts to institutionalize. Today, CFOs need to be thinking layers, not tokens.

After all, what finance leaders increasingly confront is not a single technology choice, but a stack of them. Blockchain technology, in the context of its utility, is best understood as a set of three infrastructure layers, each performing a different function, each introducing a different risk profile, and each demanding a different kind of executive judgment.

This layered view was born from a practical problem: how to balance security, decentralization and scalability simultaneously, often referred to as the blockchain trilemma.

Early blockchains like Bitcoin (and later Ethereum) were secure and decentralized but struggled with throughput and cost. Developers responded by splitting responsibilities across layers, each optimized for specific tasks. But lumping them together can obscure more than it clarifies, particularly for CFOs whose responsibilities center on settlement, liquidity, controls and accountability.

And because governance is a central challenge across all three layers of public blockchains, finance leaders are not asking whether blockchain is transformative, but which of the three core layers solve specific problems better than existing systems, and at what cost.

See more: Tokenized Deposits Steal Stablecoin Buzz — and the Business Model

Making Sense of Layer 1 Blockchains

Blockchains collapse technical, financial and operational considerations into a single stack, where transaction and settlement are the same action.

Layer 1 (L1) blockchains are the foundational settlement rails of the ecosystem. They establish consensus, record transactions and guarantee the integrity of the ledger, which is each blockchain’s unique and unchangeable record of who owns what, and when changes occurred.

Bitcoin and Ethereum are the archetypes, but other networks such as Solana or Algorand operate with the same basic principles while using different mechanisms to deliver performance and security. This also means that the guarantees of settlement finality are protocol-specific for each chain rather than there being a single “blockchain standard.”

For CFOs evaluating public blockchain settlement, the relevant criteria about which Layer 1 rail to engage with can mirror those used for traditional systems: availability, predictability of cost, legal enforceability, auditability and regulatory alignment.

Private layer 1 blockchains can solve for control by limiting participation, yet these systems often struggle to achieve scale or interoperability, limiting their usefulness beyond narrow consortia. In many cases, CFOs can find that they replicate existing financial plumbing with new terminology.

But layer 1 blockchains are an infrastructure choice. And infrastructure choices matter most when it comes to what firms are trying to build, or achieve. That is what takes place across layers 2 and 3.

Read also: The Crypto CFO Playbook for Blockchain Treasury Management

How Layers 2 and 3 Support Applications, Automation and Operational Realities

If Layer 1 is about how value moves, Layer 2 (L2) is about what moves on it. Stablecoins have become the most prominent Layer 2 instruments.

“The real opportunity isn’t about chasing the buzzwords, but it’s more about being disciplined, identifying where stablecoins truly outperform a so-called legacy payment system,” Bryce Jurss, vice president, head of Americas, digital assets at Nuvei, told PYMNTS last month.

The interaction between Layer 1 and Layer 2 are critical when it comes to the enterprise use of stablecoins. A highly regulated stablecoin may mitigate some of the risks associated with a public settlement rail. Conversely, even a private rail cannot compensate for a poorly designed instrument.

Most enterprises engaging at this layer are doing so cautiously, in limited contexts. The objective is friction reduction, not currency substitution.

Consider cross-border payments, corporate treasury operations or recurring microtransactions with suppliers. Traditional rails can be slow and expensive, locking up working capital in transit. Layer 2 models allow many interactions to be batched off-chain and then anchored to the base layer, reducing both latency and fees without sacrificing the security guarantees of the base chain.

But it is across Layer 3 (L3) where blockchain typically first becomes visible to the enterprise. These applications translate ledger-based settlement and programmable instruments into tools for reconciliation, reporting, compliance and cash management.

The risk is abstraction. Layer 3 applications inherit the assumptions and vulnerabilities of the layers beneath them. A reconciliation tool built on unstable settlement data is only superficially efficient. A smart contract managing payments is only as reliable as the asset it controls and the legal framework governing it.

Read also: Institutional Interest Is Stress Testing Blockchain’s Financial Interoperability

Interoperability and the Wider Blockchain Ecosystem

A common question in corporate circles is whether blockchain adoption requires public networks, private consortium chains or hybrid models.

Public networks offer broad participation and resilience, but governance is distributed and opaque to any single enterprise. Private or permissioned blockchains provide control and clearer compliance pathways, but they can often fail to deliver the network effects that make decentralized systems valuable.

Hybrid or semi-permissioned approaches attempt a middle ground: restricted participation for governance clarity, with bridges to public networks for interoperability.

From a CFO perspective, the choice is less about ideology and more about risk alignment. Public rails may make sense for open settlement corridors where liquidity and interoperability are priorities. Private rails may be appropriate for internal settlement, supply chain finance, or intercompany flows where control and predictability outweigh network effects.