According to TechFlow, Galaxy Research’s report on August 2 pointed out that Bitcoin faces severe challenges as a data availability (DA) layer. The main points are as follows:

  • Scarce block space: The maximum block size of Bitcoin is 4MB, and the data published by ZK-Rollup every 6-8 blocks may occupy 10% of the block space.

  • High cost: Based on a rate of 10-50 sat/vByte, the monthly data release cost of Rollup is approximately US$4.6 million to US$2.3 million.

  • Economic feasibility: Rollup needs to process a large number of transactions per month and charge enough fees to be profitable. For example, when the monthly transaction volume is 20 million, each transaction fee needs to be $0.05-0.23 to break even.

  • Increased competition: The introduction of Rollup will increase competition for block space, potentially pushing up transaction fees for all users.

  • Alternatives: If costs are too high, Rollups may turn to alternative DA layers like Celestia, or build L3 solutions.

  • Security tradeoff: Using Bitcoin as the DA layer is costly, but provides unparalleled security and decentralization.

The report believes that only a few Rollup projects can survive on the Bitcoin network, and recommends that projects explore strategies such as cooperating with miners and developing fee estimation engines to improve profitability.

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