A layer 1 is the settlement layer: it has its own consensus-mechanism, its own security budget, and its own native coin used to pay a gas-fee. Everything built on top ultimately inherits or borrows its guarantees.
L1s trade off decentralisation, throughput and cost. High-throughput chains typically run fewer, larger nodes; conservative chains stay cheap to verify but expensive to use at peak.
For traders, the relevant differences are concrete: how long finality takes before an exchange credits a deposit, what fees cost when the network is busy, and whether the chain has ever halted. A chain that stopped producing blocks during a volatility event is a chain you could not exit during that event.
Related: layer-2, consensus-mechanism, finality, blockspace