The launch of Arbitrum gave practitioners and users a boost , and Layer 2, which was still stuck in the air, finally had an impact. With the launch of Op Rollup on the agenda and the acceleration of the EVM development of ZK rollup, the Layer 2 ecology is worth looking forward to. In the launch of Layer 2 this time, we have seen a significant increase in the amount of lock-ups and a large number of applications on Layer 1. So what opportunities are brewing for entrepreneurial projects in the construction of new infrastructure? Here, Fenbushi Capital will share the entrepreneurial ideas of Celer, MCDEX and Deversifi on Layer2, hoping to give you some inspiration.
(This article was originally created by Fenbushi Capital and written by a bandit.)
MCDEX is a decentralized perpetual contract deployed on Arbitrum. MCDEX is a decentralized perpetual contract against Uniswap V3, in which the operator can freely create perpetual contracts. As a result, MCDEX may become a platform for the first issuance of new currency perpetual contracts, accumulating more long-tail assets.
MCDEX was faced with the situation that the infrastructure could not meet the business needs at the beginning of its establishment:
1. Due to the large number of operations by derivatives users, there are higher requirements for transaction convenience and low fees.
2. Dapp needs to be composable to facilitate interaction with other defi protocols. For example, decentralized perpetual contracts need to work with dapps such as chain stablecoins, Uniswap V3 liquidity providers, and option arbitrage to build a decentralized derivatives ecosystem.
Business needs drive product deployment. At that time, the MCDEX team felt that there were not many EVM-compatible Layer 2 solutions, and Arbitrum, the most versatile and fastest-growing, was the most feasible. It was a full year before Arbitrum went live. Judging from the current development of Arbitrum, it is the most secure solution and basically meets the team’s expectations.
Because Arbitrum 99.9% and is Ethernet Square compatible, so naturally become deploy dapp migration on Layer1 platform. Although the amount of locked positions on Arbitrum has skyrocketed some time ago, and the ecological development is also showing signs of prosperity, it will take time for native applications to develop on it. Because few developers choose to deploy applications on platforms that are not online, the risks and unknowability are unpredictable. For example, the Solana ecology gradually prospered after its performance has been verified. In the same way, the Layer 2 ecology on Ethereum also needs to undergo precipitation before it can truly erupt, and this cycle is at least half a year. As the first native application on Arbitrum, MCDEX adopted a bolder deployment strategy.
In the future, it is known that two new projects Perpetual V2 and Futureswap V4 will be deployed on Arbitrum. It is unknown whether the competitive landscape of Layer 2 will change with the launch of Optimsitic Rollup and ZK rollup. And whether Arbitrum will let go of the gas limit in response to competition, so that the cost of user interaction will be lower to attract more applications. But no matter what changes are taking place in the external environment, project parties and developers always need to think about how to innovate products and implementation methods through infrastructure upgrades. This is also the meaning of Layer 2’s existence.
In addition to Arbitrum, MCDEX has recently received strategic support from BSC, and will develop simultaneously in the ecology of Ethereum and BSC in the future.
Let me talk about Celer first. Celer, as the first team to study off-chain capacity expansion technology, has been racing along the way to Layer 2. From launching the world’s first mainnet of the generalized state channel network to embracing rollup solutions (whether it is developing its own Hybrid Optimistic Rollup, or cooperating with Starware to develop ZK rollup, and developing customized rollup layer2.finance), Celer’s ambitions Not only play the role of a low-level technology service provider, but also build the infrastructure and develop products by ourselves. To put it simply, Celer is a developer with product thinking.
Celer Network testnet and SDK launched in October 2018
The developed cWallet achieves a second-level transfer experience
Developed the Gomoku game cGomoku
In 2019, cWallet was renamed Celer X, with Celer Pay and Gomoku embedded
In October, CelerX was launched on the Apple Store as a compliant blockchain e-sports game platform
In November 2020, the State Guardian Network (SGN) was launched
In 2021, launch the cross-chain payment network cBridge and the expansion solution layer2.finance for Defi
From the early test water product cWallet in the payment field , the transfer can achieve a second-level experience; to the e-sports platform CelerX , the chain game has a silky user experience for the first time; to a completely non-custodial, high-speed and low-cost cross-chain payment network cBridge , to achieve cross-chain dimensionality reduction, we can see that applications based on the Celer state guardian network have changed from simple to complex, from single to multiple . However, behind the success of many products is not only the team’s keen business sense and the ability to design good products, but also the solid technical strength and the solid foundation of self-provided infrastructure (the state guardian network).
In addition to cultivating the state guardian network, Celer also embraces rollup technology. For example, layer2.finance is a Defi product designed using the Hybrid Optimistic Rollup technology developed by Celer itself. Layer2.finance solves the expensive and slow pain points of retail investors when using Defi products. By building a public transportation system in the Defi world, retail investors can also enjoy convenient and efficient Defi public products. In addition, the in-situ expansion feature of layer2.finance makes Defi no longer need to be migrated, greatly reducing DeFi transaction costs and simplifying user interaction methods, and lowering the threshold for using DeFi. In the future, layer2.finance will also launch the ZK rollup version.
Celer recently launched the cross-chain payment network cBridge (cbridge.celer.network), which is committed to opening up the multi-chain and multi-layer structure of the blockchain, and expanding the second-tier capacity in a more direct way. cBridge now supports Arbitrum, Avalanche, Binance Smart Chain (BSC), Ethereum, Fantom, HECO Eco-Chain, OKExChain, Optimism, Polygon, and x DAI . In addition, from Celer’s recently released v2.0 version of the major upgrade plan, it is understood that cBridge v2.0 will provide users with better liquidity depth, and provide the best liquidity providers (LP) to cBridge nodes and liquidity providers (LP) who do not want to run nodes. Efficient and easy-to-use liquidity management methods, and provide developers with generalized cross-chain messaging functions to support cross-chain NFT, cross-chain DEX and more applications. The realization of all functions of cBridge v2.0 is based on the upgrade of the state guardian network driven by the CELR pledge, which further enhances the value capture of the SGN network.
Celer has always been committed to the R&D and innovation of the second-tier expansion technology to bring fast, safe and low-cost blockchain applications that can be adopted on a large scale.
Deversifi is a decentralized exchange based on Starkware’s zkSTARK expansion technology. Deversifi has the following characteristics:
1. Non-custodial mechanism. The assets in Deversifi are kept in a set of smart contracts in Ethereum, and the contracts are all audited “open source codes”.
2. High-speed and low-cost trading experience. Powered by zkSTARK technology, Deversifi can process 9,000 transactions per second.
3. Order book experience. Although Deversifi is a decentralized exchange, because it uses an order book mechanism, the user experience of it is very similar to that of a centralized exchange.
As far as the degree of decentralization is concerned, although the upgrade of smart contracts requires a lock-up period of 28 days, the core protocol is decentralized. Secondly, there will be an operator in the Dapp to arrange the order of transactions that need to be verified, but even if the operator goes offline, protocol users can still withdraw money through the on-chain mechanism. Finally, the design of the user interface is centralized.
Deversifi adopted zkSTARK expansion technology after weighing the pros and cons:
– It enables real-time finality and as well as a shorter withdrawal time. ZKrollup can achieve finality in a few minutes, and support funds quickly return to the first tier. Op rollup and Arbitrum require a 7-day withdrawal period.
-The cost is the lowest when the transaction is scaled up. This refers to the higher the number of transactions in STARK verification, the lower the cost.
-The project party can optimize the expansion plan for different types of transactions, instead of using a general EVM expansion solution. This means that transactions are extremely efficient and very low-cost!
In summary, ZK rollup is a comprehensive consideration of several dimensions made by the founder of Deversifi, including deployment speed , long-term efficiency, and product-market fit . Deployment speed refers to the EVM-based scaling solution (Op rollup) that may mean faster deployment time so that developers can deploy existing solidity smart contracts. However, the project party needs to compromise on security, user costs (for example, Arbitrium still costs $3-5 per transaction) and withdrawal time.
Long-term efficiency refers to the fact that although the project party using ZK rollup (such as Deversifi on StarkEx) requires more development work (because the core protocol is written in a different programming language), in the long run, the efficiency is the highest and the cost is the lowest. ($0.02 per transaction).
Although entrepreneurs can seek multi-chain deployment, single-chain/multi-chain deployment is nothing more than a short-term/long-term consideration of entrepreneurs after weighing the pros and cons. In the short term, it makes sense for the project to be deployed on multiple chains, because projects in the experimental phase require more attempts. In the long run, multi-chain deployment will lead to fragmented user experience and chaos. For example, in a multi-chain deployment, users need to learn assets across chains and incur a certain learning cost. It is also very easy to lose assets or pay high cross-chain fees during the cross-chain process.
To sum up, although the infrastructure of Layer 2 is gradually improving, applications are being produced, but the ecology is still in a very early stage. Defi products will make choices in deployment cost, long-term efficiency, and product/market adaptability, and choose their respective ideal expansion solutions. In addition to Defi products, NFT/chain games also have their own layer 2 solutions (mostly in the form of side chains). For example, Dark Forest is to Xdai. In any case, the upgrade of Layer 2 infrastructure will inevitably bring new vitality and creativity to the crypto world, and entrepreneurs also need to design suitable products for the new infrastructure.
Posted by:CoinYuppie，Reprinted with attribution to:https://coinyuppie.com/entrepreneurship-ideas-about-layer2-mcdex-celer-and-deversifi/
Coinyuppie is an open information publishing platform, all information provided is not related to the views and positions of coinyuppie, and does not constitute any investment and financial advice. Users are expected to carefully screen and prevent risks.