Research outfit Matter Labs announced a Zero-Knowledge Proof-based scaling solution, which leverages many of the changes from Instanbul. Critics from the Bitcoin camp claim it’s just another “shitcoin.”
ZK-Rollups and “Visa-Scale” Throughput
Achieving scale has long been the Achilles heel of public blockchain networks.
Earlier approaches to the same problem may have managed to achieve a similar transaction rate but needed to sacrifice either security or decentralization in this pursuit. It is the lack of a fallible centralized authority that sets blockchain networks apart from traditional finance.
Whether it be Bitcoin or Ethereum, each has suffered from slow transaction speeds. At the time of press, Ethereum can execute 15 transactions per second and Bitcoin can process seven. Visa, a common benchmark for the crypto community, processes roughly 2,000 transactions per second.
Matter Labs hopes to solve this with their latest Layer 2 scaling solution, ZK Sync. “ZK” refers to “zero-knowledge proof,” a cryptographic privacy protocol that hides transactor data. This protocol has been proposed to help scaling efforts because it effectively reduces a large amount of information to its most essential parts.
It should also be noted, that ZK Sync is a development on the idea of ZK-Rollups which were first introduced by Ethereum programmer Barry Whitehat in 2018.
In an announcement on December 5, founder of Matter Labs, Alex Gluchowski, said,
“ZK Sync is designed to bring a VISA-scale throughput of thousands of transactions per second (TPS) to Ethereum while keeping the funds as secure as in the underlying L1 accounts and maintaining a high degree of censorship-resistance.”
Earlier in January, the Matter Labs team launched another scaling solution that combined Plasma and ZK-Snarks, called Ignis. The result allowed Ethereum to reach 500 transactions per second. While positive, the data availability problem inherent with Plasma could not be solved without controversial trade-offs. Since the latest hard fork on Ethereum, lower gas prices have given a new lease on the life of these ideas.
Specifically, EIP 2028 reduces the gas cost of Calldata from 68 gas per byte to 16, which makes previously expensive ZK-Snark-enabled smart contracts possible.
Authors of the EIP wrote that “higher bandwidth of Calldata improves scalability, as more data can fit within a single block,” adding that “proof systems such as STARKs and SNARKs use a single proof that attests to the computational integrity of a large computation… one that processes a large batch of transactions.”
Ethereum’s critics launched various reasons as to why such a scaling solution will not succeed.
Mr. Hodl, a well-known Bitcoin maximalist, attacked the centralized nature of Ethereum’s base layer, which would validate off-chain transactions like ZK Sync, adding that “no technology in the world would make me interested in it.”
In September, Chainstack cited that over 60 percent of all Ethereum nodes use cloud services to host their nodes. Roughly 25 percent of these nodes use the Amazon Web Services (AWS) cloud solution.
Others, including Mr. Hodl, critiqued the use of a token in ZK Sync’s architecture.
I’ll repeat again.. if the tech requires you to buy shitcoins (even to “improve” bitcoin) it’s a scam.
If you want to play around with new tech go try out bitcoin testnet.
— Mr.Hodl🌕🍿 (@MrHodl) December 9, 2019
A native token is introduced in ZK Sync to help the network generate Zero-Knowledge Proofs and encourage honest activity from Guardians and Validators.
Validators are the ones who batch transactions and form proofs. Thhttps://twitter.com/MrHodl/status/1204039171767189506?s=20ey are rewarded for this work with transaction fees. Guardians are the token holders within the system that nominate Validators to perform this service. The off-chain consensus mechanism, therefore, operates similarily to current Proof of Stake (PoS) networks.
For those interested in exploring ZK Sync for themselves, they can visit Matter Labs’ GitHub page or explore the demo.