Author: William M. Peaster, Bankless; Translated by: Deng Tong, Golden Finance
Recently, Ethereum founder Vitalik Buterin pointed out Taiko as a good example of a “rollup-based” blockchain. This L2 is a newer approach, but what does it mean?
Of course, a rollup is a type of L2 that processes Ethereum transactions off-chain and then sends the data back to the Ethereum mainnet (aka L1) for security. Therefore, rollup is a newer concept in the rollup space. The key feature of a rollup like Taiko is that it uses Ethereum L1 to order transactions.
In other words, the order of transactions based on Rollup is determined by Ethereum validators rather than a separate sorter. By using Ethereum for sorting, Taiko aims to be more decentralized than Rollup using a centralized sorter, which describes the situation of most L2s today.
Because L1 handles transaction ordering, Rollup-based transactions can be batched and confirmed more efficiently, potentially reducing operational and transaction costs.
Furthermore, rollup-based simplifies the technical architecture by eliminating the need for further complexities such as L2 external consensus mechanisms and signature verification sequencers.
All in all, Taiko represents an interesting new push in the Ethereum scaling space. If you want to dive in, where do you start today?
First, you need to bridge ETH to Taiko. I recommend using a "fast bridge" platform like Relay or Jumper to quickly transfer ETH in; note that you can also quickly transfer ETH out of Taiko through these same platforms when you are ready.
What then? Well, one thing to keep in mind is that Taiko Labs is now overseeing its Trailblazers Season 2 event, which runs from now until December 16, 2024.
The new season will distribute 5 million TAIKO token rewards to L2 users for trading, and features an updated experience point system, new team opportunities, new badges, revised XP multipliers, and a new battle game called Faction Battle Arena.
The main way to get deeper insights into your Trailblazers 2 activities is to try out the top Taiko apps. For example, here are some of the apps the Taiko team is currently highlighting:
Oku — A bridge and exchange platform for Ethereum Virtual Machine (EVM) chains
Ritsu — Decentralized Exchange (DEX) on Taiko
iZUMi Finance — A multi-chain DeFi protocol as a DEX-as-a-service platform
Meridian — Stablecoin, perpetual swap trading and lending protocol
In terms of size, Taiko is currently the 19th largest L2 according to L2BEAT, but the network has a lot of room to grow — not only because of its novel, secure architecture, but also because of the growing demand in the Ethereum community to use truly decentralized rollups.
Of course, the concept of “rollup-based” is relatively new in crypto, and it may take a while to catch up on why networks like Taiko are so compelling. This knowledge gap is your arbitrage opportunity in terms of participating in rollup-based substratum!