This article understands the core of the Ethereum scaling ecosystem: Rollup and Data Availability (DA) solutions

According to the plan, in the next 3-9 months, Ethereum will usher in two important upgrades. The first one is the so-called “The Merge”. The simple understanding is that the current Ethereum main network will be connected with the beacon chain’s proof of stake. (PoS) systems “merge” together, which would mark the end of the Ethereum PoW era and the network’s full transition to a PoS consensus mechanism. In addition to greatly reducing the energy consumption required to maintain the network, The Merge upgrade will also reduce the ETH new block reward by 90%, which is equivalent to ETH going through three “production halvings”, plus the EIP-1599 burning mechanism Burned ETH, which may have a very large impact on the relationship between market supply and demand. (Note: In this article, we no longer use the term Ethereum 2.0, which has been replaced by “The Merge” by the Ethereum Foundation,)

The main content of the second upgrade is EIP-4844 (also known as proto-danksharding), which is often mentioned by Vitalik and others recently. This is the first step in deploying the danksharding expansion plan, and it is also an important step for Ethereum to solve the expansion problem.

In this article, we focus on updating Ethereum’s next expansion roadmap and the progress of related ecological projects.

Note: The concept of Ethereum expansion involves sidechains, state channels, Plasma, data sharding, Rollup, danksharding, cross-chain bridges, DA solutions and other concepts, but the current focus of the community is actually the latter few, so This article will focus on Rollup, danksharding and related DA solutions.

This article understands the core of the Ethereum scaling ecosystem: Rollup and Data Availability (DA) solutions

The bottleneck of expansion, and the modular expansion route taken by Ethereum

Before explaining the modular scaling roadmap taken by Ethereum, let’s answer a question: When we talk about blockchain scaling, what exactly are we talking about?

Many people may blurt out: TPS!

And this is Solana’s approach to expansion. It adopts the horizontal expansion technology solution sealevel, which aims to gradually realize expansion with the development of hardware technology.

In the scaling logic of Ethereum, scalability = the cost of verifying all transactions.

This article understands the core of the Ethereum scaling ecosystem: Rollup and Data Availability (DA) solutions

So when a system’s nodes need to do everything, it runs into the cost of it. When the market demand is greater than the node’s carrying range in a short period of time, a fee market will appear, which shows bad phenomena such as soaring gas fees and serious delays in network confirmation. We say that the scalability of such a system is bad ( The earliest Ethereum is the best example).

With the continuous research and discussion in the technical community, the Ethereum community has gradually formed a modular expansion consensus with the Rollup L2 solution as the execution layer, the Ethereum mainnet as the consensus layer and the data availability (DA) layer (as for the history of forming this consensus) , interested readers can study by themselves, this article will not expand in detail).

In simple terms, the Rollup L2 layer will be the layer where most users interact with the entire Ethereum system, where most of the tx behavior will occur, and then these L2 systems will store the aggregated state data together with calldata on the chain Or off-chain (different schemes will be compared below).

The Ethereum main network, as the security consensus layer of the entire system, is effectively enhanced through the danksharding data expansion scheme.

Scalability of Rollup L2 layer.

After a brief understanding of Ethereum’s expansion roadmap, let’s take a look at the key Rollup L2 and DA solutions involved.

Optimistic Rollup VS zkRollup

There have been many articles about Optimistic Rollup with fraud proof and zkRollup with validity proof (zk solution), as well as the advantages and disadvantages of these schemes. In the past year, as Vitalik wrote that zkRollup will be The final Rollup expansion plan, coupled with the current high network cost of Optimistic Rollup and the one-week limit on withdrawals to the L1 mainnet, the community’s expectations for the zkRollup solution are greater than those of Optimistic Rollup.

After entering this year, as some shortcomings of Optimistic Rollup have been solved (such as withdrawal delay), and the danksharding expansion plan has been proposed, the call for the Optimistic Rollup solution to be easier to expand in the short and medium term has become more and more loud. .

Now, let’s take a brief look at some of the most anticipated L2 projects (the following L2 projects have not issued tokens):

Arbiter

Current network TVL: $3.12 billion

Rollup type: Optimistic Rollup

Financing: $3.7 million in seed round, investment institution Pantera Capital

$20 million in Series A, $100 million in Series B (September 2021), led by Lightspeed Venture Partners, and other investors including Polychain Capital, Ribbit Capital, Redpoint Ventures, Pantera Capital, Alameda Research, and Mark Cuban, post-investment The project is valued at $1.2 billion, and the latest project valuation is unknown.

The following is the ecological map of Arbitrum:

This article understands the core of the Ethereum scaling ecosystem: Rollup and Data Availability (DA) solutions

(Note: The picture is from the Eigen Network blog)

At present, the TVL of the Arbitrum network is mainly concentrated in SushiSwap (SUSHI), Abracadabra (SPELL), GMX (GMX), Curve (CRV), dForce (DF), Synapse (SYN), Dopex (DPX), Balancer (BAL), Uniswap ( UNI) and Hundred Finance (HND) on 10 apps.

This article understands the core of the Ethereum scaling ecosystem: Rollup and Data Availability (DA) solutions

Data from https://defillama.com/chain/Arbitrum

One thing to note is that although Arbitrum is temporarily leading in terms of TVL and the number of ecological applications, the update frequency of its github repository‌ seems to have slowed down.

This article understands the core of the Ethereum scaling ecosystem: Rollup and Data Availability (DA) solutions

Optimism

Current network TVL: $530 million

Rollup type: Optimistic Rollup

Funding: $3.5 million in seed round (January 2020), investment institutions IDEO CoLab Ventures and Paradigm

$25 million in Series A financing (February 2021), investment agency Andreessen Horowitz

Series B financing of 150 million US dollars (March 17, 2022), investment institutions Andreessen Horowitz and Paradigm, the post-investment project valuation is 1.65 billion US dollars.

The following is the ecological map of Optimism:

This article understands the core of the Ethereum scaling ecosystem: Rollup and Data Availability (DA) solutions

(Note: The picture comes from the coin98 blog‌)

At present, the TVL of Optimism network is mainly concentrated in Synthetix (SNX), Uniswap (UNI), Lyra (LYRA), Synapse (SYN), cBridge (CELR), Perpetual Protocol (PERP), Hop Protocol, ZipSwap (ZIP), Connext and G -UNI (GEL) temporarily lags behind Arbitrum in these 10 applications.

This article understands the core of the Ethereum scaling ecosystem: Rollup and Data Availability (DA) solutions

Data from https://defillama.com/chain/Optimism

In terms of research and development, the update frequency of the Optimism team’s github repository remains stable, and the team demonstrated the research results of mini-danksharding at the ETHDenver conference in February this year, which is the current Ethereum community actively The EIP-4844 prototype discussed.

This article understands the core of the Ethereum scaling ecosystem: Rollup and Data Availability (DA) solutions

This article understands the core of the Ethereum scaling ecosystem: Rollup and Data Availability (DA) solutions

Starkware (StarkEx+StarkNet)

Current network TVL: StarkEx $1.134 billion (1. dydx $975 million, 2. Immutable X $70 million, 3. DeversiFi $54 million, 4. Sorare $35 million)

StarkNet: still in alpha testing

Scheme type: ZK Rollup (zk-STARK) +Validium+Volition

Financing: $6 million in seed round (January 2018), investors include Ethereum founder Vitalik Buterin, Paradigm, Pantera Capital and PolyChain, in July of the same year, Starkware accepted $12 million investment from the Ethereum Foundation;

A round of financing of 30 million US dollars (October 2018), Sequoia Capital, Paradigm, Scalar Capital, Multichain Capital, Intel Capital, Semantic Ventures, Pantera, etc. participated in the investment;

The Series B financing was US$75 million (March 24, 2021), led by Paradigm, Sequoia Capital, Wing Venture Capital, Pantera Capital continued to participate, including Three Arrows Capital and Alameda Research also participated in the investment;

Series C financing of US$50 million (November 2021), led by Sequoia Capital, and continued participation from Alameda Research, Paradigm, Three Arrows Capital, etc.;

In addition, Starkware was recently revealed to be raising $100 million in Series D financing at a valuation of $6 billion, which has not yet been confirmed.

The following is the ecological map of Starkware organized by coin98:

This article understands the core of the Ethereum scaling ecosystem: Rollup and Data Availability (DA) solutions

In terms of R&D, Starkware went even further, the team came up with the modular design of L3, which can provide customized services and experiences for various applications and users.

This article understands the core of the Ethereum scaling ecosystem: Rollup and Data Availability (DA) solutions

In addition, StarkWare uses the Cairo language, which is good for performance, but is not compatible with EVM, so the applications of the existing Ethereum mainnet cannot be directly migrated to StarkNet, so the expansion of its ecology may require more education and promotion work .

As of now, although the mainnet of StarkNet is live, there are some limitations as it is still in the alpha stage.

Matter Labs(zkSync)

Current network TVL: zkSync $140 million

zkSync 2.0: still in beta

Scheme type: ZK Rollup (zk-SNARK) + zkPorter

Financing: $2 million in seed round (September 2019), led by Placeholder, followed by 1kx, Dekrypt, Hashed and Dragonfly;

$6 million in Series A financing (February 1, 2021), led by USV, with participation from Placeholder, 1kx and Dragonfly;

$50 million in Series B financing (November 8, 2021), led by Andreessen Horowitz, and institutions such as Placeholder, Dragonfly, and 1kx participated in the investment. More than 70 Ethereum ecological teams such as AAVE, Lido, and Perpetual Protocol participated in the investment.

The following is the ecological map of zkSync:

This article understands the core of the Ethereum scaling ecosystem: Rollup and Data Availability (DA) solutions

(The complete ecological list can be accessed at https://ecosystem.zksync.io/)

Different from the customized expansion route chosen by StarkWare, Matter Labs (zkSync) focuses on complete EVM compatibility. In February this year, Matter Labs announced the public testnet launch of zkSync 2.0, which is the first ZK Rollup compatible with EVM. .

Nevertheless, zkSync 2.0 may still have a long time to enter the stage of practical application.

The off-chain data availability scheme chosen by zkSync 2.0 is called zkPorter‌

Aztec Protocol

Current network TVL: $12 million

Scheme type: ZK-ZK Rollup‌ (PLONK)

Funding: Seed round (November 2018), ConsenSys Labs and Samos Investments

Series A financing (December 16, 2021), led by Paradigm, with participation from Ethereal Ventures, Variant Fund, Nascent, IOSG Ventures, etc.;

As a privacy-focused L2 layer, Aztec Protocol has yet to show enough traction, which requires more R&D and marketing efforts.

Data Availability (DA) Solutions

Above, we have mentioned some of the most anticipated Ethereum L2 projects and their progress by the community, and related to them are the supporting Data Availability (DA) solutions.

Currently, major Rollup projects are using the Ethereum L1 mainnet as the data availability layer on the chain, but this is obviously very expensive and less scalable. Therefore, off-chain data availability solutions like StarkWare and zkSync have adopted Validium, Volition, and zkPorter, which are cheaper, but obviously not as secure and decentralized as Ethereum mainnet. At the end of this year, data availability solutions such as danksharding, celestia, and Polygon Avail will also be launched one after another.

So in this section, let’s talk about these DA solutions in detail.

(Note: Practically all DA solutions face a trade-off that they have to make between cost and security.)

Validiums

The original validiums scheme uses zero-knowledge proofs to verify the validity of transactions and stores transaction data off-chain through a central data provider. Therefore, the validiums scheme is the cheapest, but its DA guarantee is also the worst (i.e., secure). Sex is the worst);

Due to these security concerns, the verification design chosen by StarkWare currently uses a committee rather than a single data provider.

Data Availability Council (DAC)

The Data Availability Council (DAC) can be thought of as a Validiums scheme with multiple nodes.

These nodes are ecologically trusted parties who keep copies of data off-chain and re-deliver them to the public in the event of malicious behavior by rollup operators. These nodes certify that L2 data is available by issuing signatures on-chain.

DAC committees usually consist of 7-10 members, so they have the power to collude to freeze (in the case of a zk rollup) or steal (in the case of an optimistic rollup) users’ funds, taking into account extreme circumstances like sanctions.

The upside, of course, is that the cost of a DAC committee is very low.

Note: Currently, Immutable X and Sorare are the DAC solutions used.

Volition

Volitions is a data availability solution that lets users choose between on-chain and off-chain, higher fees but better security when choosing the on-chain option, lower fees but better security when choosing the off-chain option will be worse.

Celestius Celestia

Celestium is an L2 chain that uses Celestia as the data availability layer but uses the Ethereum mainnet as the settlement and dispute resolution layer. Celestium can be thought of as a permissionless Data Availability Council (DAC), which has additional economic guarantees on data availability, because if the committee misbehaves, they can be penalized, so its security guarantee is higher than DAC, But in terms of cost, Celestia is obviously higher than DAC. Also, Polygon Avail is trying to do something similar.

danksharding

Last year, the Ethereum R&D team planned to achieve data availability expansion on the chain through data sharding, but due to its difficulty in implementation (it may take several years), this will bring great benefits to other L1 ecosystems. competitive opportunities.

After Dankrad Feist proposed a simplified new sharding design called danksharding, the on-chain data expansion process of Ethereum will be implemented faster, which will greatly ease the competitive pressure.

This article understands the core of the Ethereum scaling ecosystem: Rollup and Data Availability (DA) solutions

As a DA solution on the Ethereum chain, the security of danksharding is naturally the highest in theory, but there is still no conclusion about the cost. According to polynya, when danksharding is not saturated, the cost of danksharding Lower than validiums, but if saturation is reached, then validiums and other DA solutions may cost less.

This may require more research by the community.

The author predicts that if the crypto market becomes more mainstream, these DA solutions may all meet their own needs, and it seems difficult to judge what proportion of the market share they will occupy at present.

3. Summary

After years of development and discussion by developers, Ethereum has formed a very reasonable expansion roadmap, which will undoubtedly be a good thing for the entire Ethereum ecosystem. On the other hand, some of the narratives competing for L1 this year may become less appealing as a result.

But in the long run, the multi-chain and multi-rollup pattern may remain unchanged.

Therefore, tracks like cross-chain protocols are also worthy of attention.

The upcoming L2 war and DA plan war will be the focus of the author’s next focus.

References:

https://ethereum.org/en/upgrades/merge/

https://defillama.com/

https://l2beat.com/

https://eips.ethereum.org/EIPS/eip-4844

https://blog.celestia.org/ethereum-off-chain-data-availability-landscape/

https://twitter.com/epolynya/status/1495763124250685454

Posted by:CoinYuppie,Reprinted with attribution to:https://coinyuppie.com/this-article-understands-the-core-of-the-ethereum-scaling-ecosystem-rollup-and-data-availability-da-solutions/
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.

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