The most popular blockchain- Ethereum, certainly has some drawbacks, such as high gas fees and slow processing of transactions.
However, the layer 2 systems provide solutions in the form of rollups to benefit the users of the speed and cheapness of transactions without compromising on the security offered by the layer1 Ethereum network itself.
So what are rollups?
A Touch Upon Zero-Knowledge Rollups
Rollups are scaling systems built over the main blockchain network, especially to show enhanced performance in a cost-effective way. For that matter, Sidechains and state chains are other scaling solutions to show improvised performance on slow blockchains.
Rollups essentially function by rolling up a bunch of transactions in the layer2 network. Instead of waiting to process a single transaction in the Ethereum network, rollups make the process fast by bundling transactions and feeding them into the main blockchain.
This subsequently lowers the transaction fee as the cost per transaction is divided among a bunch of users in rollups. Hence at a lower cost, high-speed transactions are achieved.
Rollups are of two types:
Optimistic rollups: Optimistic rollups function by assuming all the transactions are valid within the rollup. It is designed with a waiting period of one week to claim for any malicious transactions.
Assuming all the transactions are valid, they process things quickly without spending time verifying.
ZK-rollups: Zero-knowledge rollup is abbreviated as ZK-rollups, which function based on a complex cryptographic mechanism called zero-knowledge proof. Zero-knowledge proofs verify a transaction with a limited exchange of information.
Unlike optimistic rollups that have a certain time period for dispute settlements, ZK-rollups process without delay while protecting the privacy of the information.
Undeniably, ZK-rollups are far more advantageous than optimistic rollups in speed and security. Since ZK-rollups use a complex mechanism, they are limited to specific applications such as swapping NFTs or crypto token transfers.
However, with new launches such as ZkSync by Matter Labs and others, ZK-rollups are designed to be far more efficient, equivalent to all the functionalities exhibited by the Ethereum mainnet. Zk-rollups are also built to support all the virtual applications on Ethereum.
So what’s all about this new advancement? Let’s get to the details and understand more about ZKSync.
ZkSync – What Is It?
Blockchain relies on network nodes for validating and integrating data. As a result, it leads to congestion in the network. To ease it off, Zk-rollups like ZkSync kick in to improve scalability.
ZkSync by Matter Labs is a trustless scaling and privacy solution that works on a ZK-rollups technology on the Ethereum network. Developed as a Layer 2 solution, it offloads Ethereum’s traffic- a Layer 1 network.
The excellence of Ethereum makes it the second top blockchain. It gives all the good reasons for increased user activities on the network for NFT trading, token lending and borrowing, blockchain gaming, etc., thus accounting for half the traffic in DeFi.
Whenever the traffic spikes on Ethereum, the transaction fees soar high to the roof, which greatly obstructs its mainstream adoption. To overcome this, rollups emerge as Layer 2 solutions for offloading the traffic from Ethereum to substantially further the speed at a reduced cost.
Having talked about ZkSync, the transactions are carried out with better scalability. More specifically,
- ZkSync reduces the ETH gas fee by one-hundredth times when compared to Layer 1 Ethereum.
- The number of transactions on ZkSync is 2000 TPS, while it is 14 TPS on Ethereum.
- The more transactions flow on ZkSync, the less processing time it takes to withdraw digital assets (i.e. 15mins).
A Flip Through The Features Of ZkSync
Smart contracts enforce decentralization, and Zk-rollup technology accounts for the privacy and cryptographically secured censorship resistance for ZkSync.
- ZkSync, developed for thousands of transactions per second(TPS), retains the fund security as with the underlying Layer 1 accounts. Most importantly, security is brought by decentralization.
- ZkSync supports “gasless meta-transactions” wherein users can pay the gas fee in transfer tokens. E.g. for USDT token transfer, users can pay gas in USDT itself.
- Instant confirmation of ETH and ERC20 token transfers with 10-minute finality on L1
- Low transaction fee (up to one-hundredth of mainnet fee for ERC-20 tokens and 1/30th for ETH)
- Once the block gets filled with transactions, it is ‘sealed’, and after the approval, it is written on the L1 network within minutes.
- Withdrawal to the mainnet is real-quick (~10 minutes)
Directions To Transact Using ZkSync
Link With Wallet: ZkSync is used by connecting with Web3 wallets. Notably, ZkSync supports wallets such as Metamask, Ledger, Trezor, Portis, Torus, KeepKey, etc. It also accepts linking layer 1 ETH wallet through Wallet connect or Argent wallet.
Lightning-fast transactions: After connecting with the wallet, you’re set to make cheap and fast ETH and ERC-20 transfers.
Explore details of transfer: Like EtherScan for Ethereum transactions, ZkSync uses zkScan, a block explorer and analytics platform for tracking real-time data and statistics.
Wallet → Token Transfer → Block explorer
Spread of ZkSync ecosystem
ZkSync can be used by linking the wallet with the layer one account or by setting up a ZkSync account by paying a small setup fee. The ZkSync account facilitates the transfers from all Ethereum addresses.
DeFi, Wallet, Bridges, and NFTs are finding their application with the ZkSync ecosystem. Some of the featured projects on ZkSync include,
ZigZag trading: ZigZag is a decentralized exchange platform working on Zk-rollups where users can do token swaps. It retains the features and order book functionalities the same as centralized exchanges while processing transfers at negligible fees.
LayerSwap: LayerSwap functions as a bridge for the bulk transfer of assets from the exchanges to the wallets. Again, at a low cost!
ZKNFT: ZKNFT platform allows users to mint NFTs at near-zero cost. In addition, it does not cost any fee to swap between NFTs and ERC-20 tokens.
What’s Coming next?
The “baby alpha” version is released as ZkSync’s V2, which focuses on performance. However, it is only open to internal testing by the Matter team and is soon to go live by the end of 2022 or early 2023.
What’s Our Say On ZkSync Audit?
ZkSync uses smart contracts, and rollups are an external program that handles transactions. Thus they carry inherent risks of coding bugs as rollups are still in their infancy. Therefore, getting the project audited prevents the protocol from any big damage.
With many innovations barging into the web3 space, QuillAudits intend to ensure maximum security for the project and work in the best interest of securing and strengthening web3.