Written by: Yinan
(This article was first published on PANews: A brief analysis of the ZKSync project: Understanding zksync lite and zksync Era in one article)
zksync:
zkSync is an Ethereum Layer 2 public chain that uses zero-knowledge rollup (ZK rollup) technology to solve Ethereum's current scalability issues. The mission is to increase Ethereumâs throughput while fully preserving its fundamental valuesâfreedom, autonomy, and decentralizationâat scale.
In zkSync, computations are performed off-chain and most data is also stored off-chain. Since all transactions are proven on the Ethereum main chain, users enjoy the same level of security as Ethereum.
zkSync 1.0 â-zkSync Lite launched on Ethereum mainnet on June 15, 2020
Achieved a transaction throughput of approximately 300 TPS, but is not compatible with EVM.
zkSync 2.0âzkSync Era was launched on March 24, 2023. First, it implements arbitrary smart contract functions by supporting Solidity (through zkEVM) and Zinc (rollupâs internal programming language); secondly, it implements arbitrary smart contract functions through zkPorter - a combination of zkRollups and With the sharded protocol, the throughput increases exponentially, reaching 20,000+ TPS.
The main differences between zksync 1.0 and zksync 2.0:
Smart contract support: zkSync 1.0 mainly focuses on simplified payment and asset transfer scenarios, and does not support Ethereum Virtual Machine (EVM) compatible smart contracts. In contrast, zkSync 2.0 provides full support for EVM-compatible smart contracts, meaning developers can easily deploy existing Ethereum smart contracts to zkSync 2.0.
Composability: zkSync 1.0 only supports limited cross-contract interactions, while zkSync 2.0 improves inter-protocol interoperability by retaining key EVM features such as smart contract composability. This makes zkSync 2.0 more suitable for building complex decentralized finance (DeFi) applications.
Account abstraction: zkSync 2.0 introduces new features of account abstraction, simplifying the interaction between users and smart contracts. Account abstraction improves user experience by allowing users to interact with smart contracts using any signature scheme.
More powerful development tools: zkSync 2.0 comes with a full set of development tools, including CLI (Command Line Interface) and SDK (Software Development Kit), making it easier for developers to build and deploy zkSync-based applications.
zksync era features:
Ethereum and ERC20 token transfers feature instant confirmation and fast finality on L1.
Transaction fees for ERC20 tokens and Ethereum transfers on mainnet are very low.
Payments can be made conveniently to existing Ethereum addresses (including smart contracts) using the tokens being transferred.
zksync era highlights:
With mainnet-level security, there is no need to rely on third parties.
Permissionless EVM (Ethereum Virtual Machine) compatible smart contracts.
Standard Web3 API.
Key EVM features are retained, such as smart contract composability.
Introduce new features such as account abstraction.
team:
Matter labs is the company behind zkSync, a company from Germany founded by CEO Alex G. in 2018 and has grown to over 50 employees. The team consists of experienced developers, researchers and entrepreneurs as well as core members in communications such as Zoe Gadsden (COO), Ankur Rakshit (CFO), Steve Newcomb (CPO) and Shazia Hasan. They are working together to create a more efficient, cost-effective, and secure way to transact on Ethereum.
CEO: Alex Gluchowski --- He has over 15 years of development experience and continues to evolve as a CTO and entrepreneur. He is passionate about personal freedom, self-ownership and decentralization.
COO: Zoe Gadsden---Zoe is a former Googler with 10+ years of growth and product leadership
CFO: Ankur Rakshit --- has 15 years of experience in the financial field and served as Kraken's head of financial planning and analysis.
CPO: Steve Newcomb --- a successful entrepreneur and product manager with over 15 years of experience in the industry and accelerator programs.
Head of Marketing and Communications: Shazia Hasan --- Various experience in finance and communications
Thanks to their diverse backgrounds, the team is able to navigate multiple key aspects of building a blockchain and running a company. These are very important points as the project aims to be widely adopted.
Financing:
Matter Labs has raised $258 million across 5 rounds of funding since 2018, with BitDAO committing an additional $200 million in five tranches of $40 million to bootstrap the zkSync ecosystem.
$200 million Series C in November 2022 led by Dragonfly and Blockchain Capital
$200 million in committed funding from BitDAO in January 2022
$50 million Series B in November 2021 led by a16z
$6 million Series A in February 2021 led by Union Square Ventures
$2 million seed round led by Placeholder in September 2019
BitDAOâs $200 million funding commitment will play an important role in ecosystem development. The DAO is dedicated to expanding the zkSync ecosystem through active funding in various areas:
70% of the funds will be used for strategic capital investments in areas such as DeFi, NFTs, gaming, privacy, interoperability, and even providing liquidity.
7.5% of funds will be allocated to grants to develop tools for migrating from L1 to L2 to accelerate adoption and encourage further investment and research by industry players.
7.5% of the funds will be used to fund the hiring of security audit firms to ensure the security of the ecosystem and create security knowledge and standards.
5% of funds will be allocated to research and development to improve zkProofs and related technologies
5% of funds will be allocated to education and training on the opportunities technology offers and its impact
Five percent of the funds will be used for operations such as legal setup, compliance and payroll.
Investments will be selected by the decision-making committee based on the goals and objectives established in the first phase. These milestones may include the number of investments made, grants awarded, impact of public goods funded, contributions to DAO core tools, and any other metrics the steering committee and funding team decide to include.
route map
It is currently in the Fair Onboarding Alpha stage and the zksync 2.0 mainnet online stage.
The next phase will be, layer 3 concepts
Layer 2 is the first step toward scalability, developer experience, and user experience. zkSyncâs EVM-compatible Layer 3 proof-of-concept âOpportunityâ will debut in the first quarter of 2023, bringing a series of 10x growth moments to Ethereum. will provide:
Layer 3 HyperChain prototype built on top of Layer 2, enabling the ecosystem to conduct research and experimentation.
Start developing developer tools, including CLI and SDK for creating and interacting with Layer 3.
The end will be: decentralization
To support Ethereumâs mission, the zkSync 2.0 protocol will be decentralized, including proof generation, block production, and transaction verification. Thinking is already underway on how to decentralize various parts of the system, and clear instructions on how to run a node will be provided.
Tokenomics
As of now, according to The Blockâs interview with Matter Labs CEO Alex Gluchowski about the token, hereâs what he said:
The launch of the ZkSync Era will not initially come with tokens, as the network is currently still largely centralized. Since it's in alpha, Matter Labs can upgrade the network's code at will. Additionally, the company still controls the sequencer and prover, two core components that make the network run.
âTokens are not needed at this time. Once you want to decentralize the orderer, you need tokens. Everything has to have a purpose and a reason. To participate in the validator set permissionlessly, we have nothing better than tokens right now â like how do you make it license-free. But for now, because we're on this sequencer, it's not necessary yet," Gluchowski said.
He estimates that the sequencer will be decentralized in a year or so. That is to say, the token may be released in about a year.
ecosystem
Matter Labs claims that more than 150 projects have been deployed or are willing to deploy on the chain, but there are not that many that can actually be used at present. There are banxa, zigzag, etc. on lite, and those currently synchronized with Era include mute, mint square, spacefi, orbiter, syncswap, etc.
TVL
It can be seen on defillama that as of the time of publishing, the overall TVL has increased by 400% in the past 7 days. The current total locked amount of zksync is 50 million US dollars, among which Syncswap accounted for nearly 50% of the total locked amount. The growth rate can be described as rapid. There is still a big gap between TVL and Arbitrum's 2.5 billion and Optimism's 1 billion. Of course, this is related to the project ecology and the technology used. Currently, there are more than 100 projects on arb and op, while zksync is currently on Era. There are only a few applications. Both arb and op use optimistic rollup, while zksync and starknet both use zk rollup. The technical difficulty of the latter is higher than that of the former.
Summarize
First of all, zksync is attracting more attention from both the team and project financing. The technology is also zk-rollup. Because of the technical characteristics of zk, it is more difficult to develop, but its security is higher. In the long run, zk-rollup will be the mainstream in the future. There is a big gap between zksync and Arb and OP in terms of project ecology. The previous 1.0 was not compatible with EVM, and the Ethereum ecosystem cannot be migrated well. The current 2.0 Era will become compatible with EVM after it goes online, so that Ethereum ecological applications It can be migrated more easily. I believe zksync will perform well in the future. I look forward to the subsequent development of zksync.
