ZK-rollups step into the limelight after the quest to scale Ethereum evolves

Scalability on the Ethereum (ETH) network has been a point of contention within the cryptocurrency ecosystem for years, primarily due to high fees and network congestion during peak demand periods.

The latest solution to emerge as the final solution to Ethereum’s scalability problems is zero knowledge accumulators (ZK accumulators), a form of scaling that runs calculations off-chain and sends them on-chain through a test. validity.

Earlier in the year, protocols that chose to use upbeat summaries such as Optimism and Arbitrum dominated the headlines and were touted as the best solution for scaling on Ethereum, but apart from Arbitrum, the hype for those protocols has died down and traders have pointed out. . that even optimistic roll-ups have higher rates than desirable when the network is in peak demand.

First successes in 2021

At the same time that optimistic cumulative solutions were in the limelight, protocols that adopted the ZK cumulative model quietly demonstrated their capabilities.

dYdX, a decentralized futures and perpetuals exchange, was an early adopter of ZK-rollup technology through its partnership with StarkWare, whose StarkNet network is a permissionless decentralized ZK-Rollup.

To date, the platform has had decent success, managing to process a higher 24-hour trading volume than Coinbase at times.

Loopring (LRC) is another protocol that has been used by ZK-rollups to lower transaction costs and accelerate its throughput capabilities, helping to propel the LRC price to a new all-time high of $ 3.83 in early November.

LRC / USDT 1-day chart. Source: TradingView

Related: Ethereum layer-two TVL hits all-time high

ZK Rollups Could Be The Next “Rotation” For Traders

After last week’s strong market-wide sell-off, ZK’s cumulative packs have re-emerged as a buzzword in the cryptocurrency sector.

Polygon, a layer two platform for the Ethereum network, made headlines with the announced acquisition of Mir, a project that develops two subcategories of zero-knowledge tests known as PLONK and Halo.

Polygon’s investment of 250 million MATIC tokens, which already offers some of the lowest fees of any protocol on the Ethereum network, was made in an effort to “explore and encourage all significant scaling approaches and technologies at this stage” , according to Polygon co-founder Sandeep Nailwal.

Another highly anticipated protocol that has been gaining traction recently is zkSync, an escalation solution created by Matter Labs that secured $ 50 million in a Series B round led by Andreessen Horowitz in early November.

Total zkSync deposits vs. total unique users

According to Digital Delphi, the two main projects that are active on zkSync are ZigZag, a decentralized exchange, and a funding platform called Gitcoin.

Delphi Digital analysts said:

“Based on L2 fees, token exchanges through ZigZag on zkSync have the lowest fees.”

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