Bitbyte Academy—An analysis of zkSync, a Layer 2 scaling protocol compatible with EVM
zkSync is a Layer 2 scaling protocol for the Ethernet blockchain that improves the scalability and speed of use of the Ethernet network through zkRollup scaling technology and implementation of EVM compatibility. The implementation provides cheaper and faster transactions while still guaranteeing on-chain security and decentralization.
Since its launch in 2020, zkSync has made numerous advances and is now known as zkSync Era for zkSync 2.0, and zkSync Lite for zkSync 1.0. zkSync has attracted a lot of market attention and investment for its unique approach to Ether scaling, and has gained a large following among developers and users.
Overview
According to official claims, zkSync focuses on 5 main properties of Ether, namely being a universal protocol, being EVM compatible (i.e. supporting Solidity language), paying gas in ETH, being open source and decentralized.
Therefore, shortly after the launch of zkSync 1.0 in 2020, the team has already started working on supporting EVM compatibility while ensuring security and eco-application deployment, as in zkSync 1.0 users can only experience extremely limited functionality such as transferring money and casting NFTs.
In February 2022, zkSync 2.0 was launched, enabling arbitrary smart contract encoding functionality with support for Solidity (zkEVM) and Zinc (Rollup’s internal programming language), as well as an exponential increase in TPS from roughly 300+ to 20,000+ TPS with zkPorter, making it the first and most efficient L2 EVM-compatible extension protocol.
Since its creation, zkSync has had a goal to bring mass adoption to the industry. With the launch of zkSync 2.0, the team claims to be launching zkEVM-powered L3 in the first quarter of 2023, and with the implementation of Layer 3 technology and account abstraction the ultimate goal of mass adoption will be achieved much sooner.
Technology
zkSync has a unique technical advantage and ecological potential with its Solidity-language enabled zkEVM and Snark-proven zk-Rollup-based technology.
Vitalik, the founder of Ethernet, has publicly stated his opinion that zk-Rollups will be the ultimate solution for scaling the Ethernet network. Currently, zk-Rollup paths represented by zkSync2.0 and StarkNet are also widely regarded as the ultimate solution for Layer2 scaling.
Compared with op-Rollup technology, which has stronger availability, the advantage of zk-Rollup technology is that it adopts zero-knowledge proof technology to verify transactions, and only needs to store the compressed transaction information and final state proof on the Ethernet mainnet, which not only saves space for storing transaction signatures, but also improves data compression efficiency, enabling zk-Rollup to achieve higher TPS than op-Rollup. The TPS of zk-Rollup is an order of magnitude higher than that of op-Rollup. What has been achieved so far is that withdrawals from zkSync 2.0 to the Ethernet mainnet take only 10 minutes to confirm.
On the zkEVM side, the Ethernet virtual machine, which verifies the correctness of the program through zero-knowledge proof technology, not only executes smart contracts in a zero-knowledge technology way, but also follows the EVM opcode and bytecode specifications, which greatly reduces the development threshold of ecological applications.
In terms of technology, in terms of algorithm, SNARKs have perfect infrastructure and code base, and short proof time; in terms of language, zkEVM is more compatible with the mature Solidity language in terms of adapting zero-knowledge proof technology; in terms of architecture, virtual machines adapting zero-knowledge proof are more likely to emerge application innovations at the ecological level.
Based on the technical features and protocol framework, zkSync has many advantages, such as lower transaction fees, only one percent of gas of Layer 1; faster transaction speed, more than 2,000 transactions per second, compared with 15 transactions in Layer 1; good security, inheriting the security guarantee of the Ethernet blockchain; more convenient cross-transferability, able to switch tokens between Layer 1 and Layer 2 Easily convert tokens between Layer 1 and Layer 2; completely decentralized, no registration required to receive digital assets and funds.
Team
The zkSync development team is Matter Labs from Germany, founded in December 2018. zkSync, the ZK Rollups protocol, was launched on Ether in June 2020. zkSync closed a $200 million Series C round in November 2022, co-led by Blockchain Capital and Dragonfly, with participation from a16z, Variant, Lightspeed Venture Partners, and others.
zkSync claims it will be managed by a DAO called zkDAO and will facilitate the growth of its ecosystem by funding various projects and initiatives. Through its partnership with BitDAO, the entity will focus on 5 main areas such as providing strategic capital for protocols in the ecosystem, developing chains and pro bono tools based on bonuses, research and development to continue improving protocols and the ecosystem, education, organizing events and workshops to raise awareness of ZK technology, and the ongoing implementation of the highest standards of security in the ecosystem.
Ecology
In terms of economic design, the team claims that only 30% of the tokens will be distributed to the team and investors, with the rest going to the community and the development of the ecosystem. To date zkSync has not disclosed any information about its tokens and token economy, but has attracted a large number of users to participate in the zkSync network as other expansion projects have been issued and airdropped.
In terms of roadmap, the scheduled launch of zkSync 2.0 provides an exciting message for the entire industry in the context of the bear market, and the team is continuing to deliver consistent and solid innovation to the community, meaning that zkSync 2.0 will give all eco-projects and users, an availability protocol with TPS performance improvements at least an order of magnitude higher than Ether.
Although zkSync is not open to all users until security audits, bug bounties, and system testing are all complete, more than 150 projects have deployed or shown interest in deploying on the chain, and these first movers have pushed up zkSync’s TVL for a time, even though most of these applications are not yet live on the mainnet.
Community
The community has been looking forward to advances in zero-knowledge proof technology to provide better security, scalability and lower cost of use, while EVM compatibility is a must for every blockchain to grow explosively, as over 60% of the total TVL is on ethereum.
At present, zkSync is already the Layer 2 project that has received the most attention in the market. Meanwhile, along with the fundamentals of zkSync, whether in terms of team organization, technical advantages, or capital investment and community reputation, zkSync provides high value to the industry ecology for the exploration of the entire zkRollup and zkEVM direction, based on its advantages and influence. zkSync will most likely become an important player in the blockchain space and lead the next wave of crypto.
zkSync is committed to bringing massive adoption to the blockchain ecosystem, focusing on zero-knowledge technology and Layer 3 technology to solve the problems of transaction speed, scalability and user cost. With a team of engineers, many head organizations injecting capital, and potential airdrop incentives, zkSync is undoubtedly becoming the focus and top stream for the entire industry.
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