Analysis of Ethereum Layer 2 Rollup Technology

Layer2 is one of the key solutions designed to address the scalability issues of Ethereum. By building an additional network layer on top of the Ethereum main chain, Layer2 allows for the processing of more transactions while maintaining the security and decentralization characteristics of the main chain.

Rollup is currently the most mainstream Layer 2 scaling solution, which processes transactions off-chain and then "packages" the transaction data into the main chain. Compared to other off-chain transaction solutions, Rollup has the following characteristics:

1. Layer 2 is relatively independent from Layer 1, allowing users to trade with other users on the Layer 2 platform, but interactions between Layer 1 and Layer 2 accounts must be conducted through smart contracts.

2. All transaction information is fully recorded on the main chain, solving the data availability problem.

3. Transactions are executed on Layer 2, but the state summary will be published to Layer 1 for verification.

According to the different methods of data validity verification, Rollups can be divided into Optimistic Rollups and ZK Rollups.

The Development History of Rollups

Sidechains are one of the earliest Layer 2 solutions, which are independent blockchains linked to the main chain. Plasma is an evolved solution of sidechains, building independent blockchains outside of Ethereum to form a tree network.

However, Plasma faces issues such as data availability attacks and exit delays. In 2019, the Optimistic Rollup solution was proposed to address Plasma's data availability issues. At the same time, the prototype of ZK Rollup also began to take shape.

ZK Rollup uses zero-knowledge proof technology to prove the validity of state changes. The Plonk algorithm, proposed in 2019, addresses the generality issues of zk-SNARKs and accelerates the development of ZK Rollup.

Overview of the Rollup Track

Currently, Optimistic Rollups account for the majority of TVL, but ZK Rollups are receiving increasing attention.

Optimistic Rollups

Optimistic Rollups assume that most transactions are valid, allowing challenges and rollbacks when fraud is detected. Representative solutions include Arbitrum and Optimism.

Arbitrum launched its mainnet in September 2021 and is the Layer 2 protocol with the highest TVL. Its ecosystem includes three networks: Arbitrum One, Arbitrum Nova, and Arbitrum Orbit.

Optimism launched its mainnet in August 2021, boasting the second largest TVL in Layer 2. Its OP Stack is an open-source modular toolkit that supports developers in building customized Layer 2 networks.

ZK Rollups

ZK Rollups use zero-knowledge proof technology to ensure the validity of off-chain transactions, providing higher security and efficiency. Representative solutions include zkSync, StarkNet, Polygon zkEVM, and Scroll.

zkSync is the first zkEVM project to launch on the mainnet, using "optimistic" transfers to reduce transaction time. StarkNet utilizes zkSTARK solutions to enhance privacy and security. Polygon zkEVM achieves EVM compatibility at the bytecode level. Scroll allows developers to easily migrate existing applications to the Rollup network.

Summary

Rollups technology is expected to solve the performance bottleneck of blockchains, improving transaction speed and throughput. In the short term, Optimistic Rollups may dominate general EVM computation, while ZK Rollups have more advantages in specific application scenarios.

In the long run, with the improvement of ZK-SNARK technology, ZK Rollups may become the ultimate solution for Ethereum scalability. The development of Rollups technology will bring more possibilities to the blockchain ecosystem and drive the industry forward.