Global Web3 Ecological Innovation Observation Report

Original source: Dao of Defi & SUSS NiFT

Foreword

This is the world's first comprehensive report to observe the industry from a complete Web3 perspective. As long-term practitioners, we have clearly seen that with the continuous maturity of blockchain technology, computing power, encryption market, Metaverse, Web3 and other fields are booming, and the boundaries of this industry are expanding step by step.

And our reports also There is no doubt that it is a new look on the shoulders of giants: Messari's Crypto Theses for 2022, a16z's Sate of Crypto 2022, McKinsey's "Value Creation in the Metaverse" report, etc...they They all describe the past or present of this industry from the side of Web3. In addition to standing in the perspective of the entire Web3, our report, like them, can only be responsible for the current history.

Our report from Web3 Speaking of ideas, this can probably be traced back to the germination of ideas when the Internet first appeared in the last century. This is followed by infrastructure at the technical level and current mainstream applications, as well as DeFi, NFT, chain games, DAO and other current Web3 hottest development areas. This period basically corresponds to the creation block of Bitcoin to the release of the report. the moment before. After that is the metaverse world that we can see right now. Finally, we chatted about the investment and regulation that comes with the industry. We are fortunate to have witnessed the birth of this industry, so we hope this report can accompany the growth of this industry.

Chapter 1 Web3: The Renaissance of Cyberspace

From the second half of 2021, the search volume of "Web3" keywords on the Internet will increase rapidly. People are starting to talk about Web3, and it seems that the Web3 ideal will become a reality tomorrow. Web3 is not a product that appeared out of thin air, but a continuation of the spirit of cyberpunk and cypherpunk in the 1980s and 1990s. The current fiery Web3 revolution is more like a renaissance after injecting the original economic blood into cyberspace.

Section 1 Cyberspace Declaration of Independence

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On February 8, 1996, John Perry Barlow, founder of the Electronic Frontier Foundation, published The Game The Bospace Declaration of Independence declares that the online world is an independent spiritual home, free from the jurisdiction of any traditional forces.

The declaration mainly reflects The following three propositions:

1. No matter: Our world is both omnipresent and illusory, but it is by no means a world in which entities exist.

Second, without borders: where everyone can join, and there is no privilege to produce because of race, economic strength, force or place of birth or prejudice.

3. Non-discrimination: where anyone, anywhere, can express their beliefs without fear of being forced to remain silent or Obedience, however strange the belief may be.

Barlow’s declaration quickly Become famous and spread widely on the Internet. Nine months after publication, it had been reposted by about 40,000 websites.

We will create a civilization of the Mind in Cyberspace.

——John Perry Barlow

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However, with the development of the Internet, his declaration has been questioned by more and more people. In 2002, the number of sites reprinting the manifesto had dropped to approximately 20,000. Even himself, in a 2004 interview, Barlow reflected on the work he did in the 1990s, especially the optimism he embraced at the time. "We're all getting older and wiser," he said. Obviously, the scene depicted in the "Manifesto" was not realized at the time, but this did not affect the continued pursuit of idealists.

Section 2 Early Attempts of Cyberspace Sovereign Currency

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If currency is an indispensable blood for the efficient operation of modern economic society, a cyberspace independent of the physical world should also It has a native currency system and conducts economic activities based on it.

"Cyberspace Independent At the same time that the Manifesto appeared, the cypherpunk movement was also flourishing. In the "Cypherpunk Manifesto" published in 1993, Eric Hughes expounded the mission and goal of cypherpunk, which is to build an anonymous system through cryptography and other methods to defend people's privacy. At the same time, the manifesto also mentioned that "software cannot be destroyed, and a completely distributed system will never stop."

We the Cypherpunks are dedicated to building anonymous systems. We are defending our privacy with cryptography, with anonymous mail forwarding systems, with digital signatures, and with electronic money.

— —Eric Hughes

1983 , David Chaum (David Chaum) proposed an anonymous electronic cash system based on blind signature technology, which was the predecessor of the later electronic currency eCash. But it didn’t catch on in the end, and DigiCash, the operating company behind it, declared bankruptcy in 1998. There may be many reasons for the failure of DigiCash, but the essence may be due to their centralized architecture, because once the centralized company and the central server collapse, the system will not be sustainable. It is hard to imagine that in the future we will use a certain company's products as the Internet's common currency standard for transactions.

DigiCash closed down In the same year, another cypherpunk, Wei Dai, proposed b-money, an anonymous and distributed electronic cash system. b-money can be said to have the basic characteristics of all modern cryptocurrency systems, but due to various technical reasons, b-money has never been officially launched.

The time has come to 2005, Nick Szabo designed a decentralized digital currency mechanism called bit gold. All data in cyberspace can be easily copied and pasted, which means that the design of digital currency needs to solve the "double spending problem". Most digital currencies solve this problem by introducing a centralized authority to record the balances of all accounts, but Saab does not approve of this solution, "I want to imitate the safety and security of gold in cyberspace as much as possible." Trusted features, most importantly it does not depend on a trusted central authority". bit gold This architecture is considered to be "a direct precursor to Bitcoin", but unfortunately it has never been realized.

From eCash to b- From money to bit gold, the early cypherpunks made many attempts to create the original sovereign currency of cyberspace, but they did not achieve practical application.

Section 3 Software is eating the world

At the same time, the Internet also completed the transformation from the Web 1.0 stage to the Web 2.0 era, but also encountered developments that were difficult to solve with the existing architecture bottleneck.

Web 1.0 is a Puci refers to the first stage of the development of the World Wide Web, from about 1991 to 2004. At this stage, there are very few content creators, and the vast majority of users are just consumers of content, and “go away after use up”.

In the era of Web 2.0 , Ordinary network users can exchange information and collaborate on various Internet platforms at a very low cost. At this time, the core concept of Internet products is interaction, sharing and association. It was also during this period in 2011 that a16z partner Marc Andreessen chanted the slogan "software is eating the world". He wrote: "We firmly believe that many well-known emerging Internet companies are building real, high-growth, high-margin and high-walled business models."

After that, we did see Meta (formerly Facebook), Amazon, Alphabet (Google’s parent company), The rapid rise of Internet technology giants such as Tencent. Although the businesses of these giants are different, their rise has one thing in common, that is, they can all obtain state from users. In computer systems, "state (

state)" refers to the state of a thing at a certain moment, and stateful (stateful) It means that for the same input, the output value will change according to the state at different time points. For example, when a user uses the search service provided by Google, every click he makes on the search results page can help the search engine provide more accurate search results for the next user.

In the stage of Web 2.0, Users are not only users of Internet services, but users have become a part of Internet products. The status of Internet services will grow compoundly. Users trust the platform and hand over their status in exchange for better services. At the same time, platform service providers also have a higher valuation.

But at the end of the honeymoon period , After the growth of the platform enters the bottleneck period, they will often live up to the trust of users, and the relationship with users will change from a positive-sum relationship to a zero-sum relationship. Platforms need to squeeze all kinds of data, including privacy, from users to maintain growth, and former partners become competitors. At the same time, the Internet platform has acquired a very high state through the accumulation of years and months, and it is difficult for new entrepreneurs to overcome the state wall, which hinders the emergence of competition and innovation.

Software is eating the world, The services on the upper layer of the software have begun to erode the interests of participants, and the Internet urgently needs a paradigm shift.

Section 4 Blockchain Genesis

On October 31, 2008 Eastern Time, Satoshi Nakamoto published the Bitcoin white paper on a cypherpunk mailing list . And two months later, on January 3, 2009, the creation block of Bitcoin was mined. This marks the birth of a trust-free Internet native currency that the cypherpunks have been pursuing for the past few decades, and cyberspace has gained the blood of economic activities.  

Vitalik Buterin at Bitcoin Miami, January 24, 2014 The conference officially announced the birth of the Ethereum project. On the basis of Bitcoin, Ethereum provides developers with higher flexibility: Ethereum introduces Turing's complete virtual machine into the blockchain, turning the entire network into a general-purpose virtual computer shared by the world. The emergence of DeFi protocols such as Uniswap and Compound means that people can engage in more and more complex transactions, lending and other commercial activities in cyberspace. After that, the emergence of new things such as NFT, GameFi, and DAO also provided more venues for the aborigines of cyberspace.

April 2014, Gavin Wood, the co-founder of Ethereum and the CTO of Ethereum at the time, systematically elaborated the concept of Web3 for the first time. Jiawen believes that in the post-Snowden era, Internet users can no longer trust companies, and companies will only manage and use user data for their own profit purposes. Therefore, it is necessary to create Internet infrastructure and applications that minimize trust. Jiawen believes that "Web 3.0 is a set of eclectic protocols that provide application developers with basic building blocks that enable them to build applications in a new way. These technologies enable users to verify the (authenticity) of information received and sent, ensuring Reliably give and get in the process. Web 3.0 can be seen as the enforceable Internet Magna Carta and the cornerstone of individual freedom against authority.”

So far, the revived cyberspace has begun to take shape, which will be a decentralized network system: < /p>

1. Open and verifiable, Participants master the controller and ownership of the state;

2. Inclusive and non-discriminatory, all participants can use network services equally;

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3. There is no single point of failure, and the network structure is extremely robust;

4. No centralized decision-making governance, all changes need to be authorized by participants;

5. Cyber Space has a native trust-free economic system.

Thriving Community DAO And Web3 applications have shown us what kind of power strangers on the Internet can produce in cyberspace based on the same values and missions. With the evolution of infrastructure, there are countless possibilities to be discovered in the future.

Conclusion

Finally, I would like to end this chapter with a quote from Multicoin Capital co-founder Kyle Samani:

Trust is the foundation of all economic relationships. The greatest investment opportunity of our lives is to bet that it doesn't have to be.

Chapter 2 Infrastructure (Public Chain)

The Web3 revolution may have started a long time ago, but the era of blockchain history only began in 2009 when Bitcoin was born. In this revolution that started with the blockchain as a symbol, the public chain is undoubtedly the most important foundation. From Bitcoin's PoW, to ETH 1.0 loaded with smart contracts, and then to each L1 network of PoS. The public chain has undergone three major iterations in the past 13 years. Today's Web3 is a mixed system of three models, and the public chains of each model have their own advantages and disadvantages, and they coexist prosperously.

Section 1 "Rashomon" of Bitcoin

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This is the fourth halving cycle of Bitcoin (BTC). As Bitcoin's blocks continue to increase, it becomes more and more difficult for us to tell what Bitcoin is. There are too many meanings added to this "coin" born in 2009. Therefore, we can only observe the "Rashomon" of Bitcoin from a constantly changing perspective.

1.1 BTC vs fiat currency

Bitcoin enthusiasts still firmly believe that Bitcoin will It will replace legal currency and become a universal payment tool in the world. As written in the Bitcoin white paper: a peer-to-peer payment system. In September 2021, El Salvador first recognized Bitcoin as one of the national legal tenders, which also gave great encouragement to Bitcoin payment believers.

But this kind of And the promotion of Bitcoin from below has been resisted from below. There are anti-Bitcoin protests, and a considerable number of people just download the wallet for the first payment of $30 and then stop using it, and the proportion of retailers adopting it is not high.

El Salvador originally planned to The $1 billion bitcoin “volcano bond” sold in March is also yet to be listed. Other countries are also considering accepting Bitcoin as legal tender, but only the Central African Republic has made an official announcement. Will Bitcoin One Day Replace Fiat? Can Bitcoin Replace the U.S. Dollar as the World Currency? The BIS thinks not in a special edition of its annual economic report, The Future Monetary System, due out on June 12, 2022. Governments and regulators in various countries also think it is impossible.

Maybe so, but The payment system and wallet brought by BTC may bring opportunities for people who lack bank accounts to enjoy financial services. In fact, even though El Salvador may not end up popularizing Bitcoin, their promotion of Bitcoin Lightning Network wallets has allowed quite a few locals to receive USD remittances from loved ones overseas. They have at least one more choice.

1.2 BTC vs Assets (Gold & Stock)

For a long time, Bit All coins are "mines". It’s just that the era of personal gold rush is over, no matter what the reason is, institutions have become the main force of “mining”.

Source: Global Hashrate Distribution

Energy disputes in 2021 clear some countries "Mining" (Bitcoin's verification mechanism PoW needs to consume energy for random "puzzle solving" to create blocks); some countries have banned virtual currency transactions; the market has turned bearish; Ethereum is turning to PoS...the computing power is one and the other It has been undergoing migrations for a long time, but it has never disappeared, just like it has been going on in the past ten years.

Bitcoin in the last 10 Gold has been eating into the market for most of the year. And regardless of the external market, holding Bitcoin has become a hedging asset against risks. Just like Ray Dalio (Ray Dalio) and many investors add Bitcoin to their investment portfolios in small proportions.

But in recent months , the situation seems to have changed, and gold has a tendency to rise again.

Source: Woobull Charts

BTC, which has maintained a low correlation with the U.S. stock market for a long time, has increasingly converged with Nasdaq, especially large-cap technology stocks, in the past six months. This shows that for the asset attributes of BTC, the attribute of "mining" is weakening, while the attribute of technology stocks is increasing.

Source: Bloomberg

1.3 BTC vs Crypto

BTC is more from the perspective of blockchain represent core values. In terms of market capitalization, BTC accounts for more than 40% of the entire market all year round. When the market is bullish, the market will turn to other tokens, and

When the market turns bearish, the share of BTC will increase. This also creates the perception that BTC is the last collateral. Therefore, there is a discussion that PoS is feasible because PoW is feasible.

In the blockchain Structurally, PoW's network architecture and verification mechanism are no longer mainstream in new blockchain development. However, the main chain of BTC has also determined its own positioning and values after multiple hard forks: ultimate security and value storage functions. The payment function is handed over to the L2 Lightning Network. Smart contracts mostly run on ETH and other L1 chains, and communicate value with BTC through cross-chain bridges (or centralized trading platforms).

November 2021 The Taproot upgrade is long overdue. But this brings new security, privacy and scalability to BTC. We haven't seen mainstream applications come out yet, but the world of BTC has undoubtedly become more imaginative.

1.4 BTC vs DAO

In addition to providing a most reliable The native asset of the encrypted world, the significance of BTC for Web3 may lie in a newer organizational method. At least it proves that a job that requires large-scale world coordination can be completely trustless.

Man and machine, or It is said that there is a successful cooperation case between people through code.

1.5 BTC vs World

In previous BTC narratives, people called It is the cornerstone of the blockchain world. Over the years, the blockchain world on Cornerstone has become more and more abundant. At present, this cornerstone is more deeply connected to the real physical world, and has more and more influence on reality, such as financial institutions on Wall Street, regulatory agencies in various countries, civilians in the third world, and players in the technology industry. And the addition of these people has made BTC present a different form from before. Therefore, BTC has become a bridge connecting the two worlds. One virtual, one real. Somehow, WAGMI (maybe, we'll all make it).

Section 2 Ethereum: Smart Contract Platform

Ethereum (Ethereum) is a public blockchain platform with smart contract functions, allowing anyone to Build decentralized applications. Since Bitcoin opened the blockchain era in 2009, the most representative technological innovation is the emergence of Ethereum smart contracts, which provide the most solid underlying foundation for the emergence of DApps, the blowout of DeFi applications, and the upsurge of NFTs.

2.1 Intelligence Contract

A smart contract is a contract that can be programmed, that is, a Automatically executed program fragments, smart contracts have a very important prerequisite for generating application value, that is, there is a non-tamperable storage and execution layer, so that it cannot be destroyed by physical factors.

Blockchain provides The non-tamperable modification also allows the blockchain and smart contracts to naturally fit together, allowing blockchain technology to break away from the pure cryptocurrency payment function, with Turing completeness, breaking the limitations of Bitcoin as a simple ledger , to achieve complex value transfer. At the same time, rich application scenarios also put forward greater requirements for blockchain performance, indirectly giving birth to various high-performance public chains and Layer2 projects in the future.

Currently, Ethereum serves as The largest smart contract platform, its contract language Solidity is the most widely used and most popular programming language. Among the various applications built using the Solidity language, the locked asset value accounts for the entire DeFi total locked value (TVL) ecological application 85% of the value.

Source: The Block

Ethereum ecological applications are concentrated in the DeFi field, mainly including: DEX (Uniswap), lending (Aave, Compound), derivatives (dYdX), stable Tokens (MakerDAO, Frax), and other applications are mainly distributed in the fields of NFT and blockchain games.

Currently, the Ethereum chain The upper TVL is 47 billion US dollars, which is equivalent to the market value of MediaTek and Kuaishou. The top three ecological applications are MakerDAO, Lido and Uniswap, respectively accounting for 16.7%, 10.3% and 9.9% of the TVL of Ethereum.

Source: DefiLlama

2.2 Ethereum is compatible with EVM chain

The Ethereum Virtual Machine (EVM) is a necessary choice for many public chains and the second layer. As the public chain with the largest ecology and the largest number of developers, Ethereum plays a pivotal role in the entire public chain field. At present, there are hundreds of active public chains and EVM-compatible chains in the market, but few of them can form their own ecological moats. Each public chain has changed from the past TPS-only theory to the two-wheel drive of ecological construction and capital incentives.

The ecological development of Ethereum has always been Yiqijuechen, with the gradual advancement of the merger of Ethereum and the final sharding, the irreplaceability of Ethereum has been further strengthened, and various public chains have begun to be actively compatible with Ethereum, allowing developers to easily realize the migration and deployment of DAPP. As a result, a large number of EVM-compatible chain ecosystems have also been formed, and EVM-compatible DAPP also makes multi-chain deployment of applications easier. For example:

BNB Chain (BSC)

On September 1, 2020, the Binance Smart Chain was launched. As the first EVM-compatible public chain launched by the trading platform in the summer of DeFi, BSC has undertaken most of the traffic from the Binance platform and has also achieved BSC In the field of public chains, BSC adopts a DPoS mechanism similar to EOS. The TPS can reach 30-70 times that of Ethereum, but the number of effective nodes is only 21, and the degree of decentralization is not in the same order of magnitude as Ethereum.

Avalanche- C

Avalanche is an interoperable, highly extensible Decentralized public chain network, Avalanche is divided into X chain, C chain, and P chain. Among them, C chain is an EVM compatible chain and a smart contract chain; X chain is a DAG structure with the fastest transaction speed and is mainly used for transfer; P chain It is a chain related to nodes, mainly used for Staking, similar to Polkadot's relay chain.

Fantom< /b>

Fantom is based on DAG technology and supports EVM compatible high-performance public With the background of Andre Cronje, Fantom's ecological development has ushered in explosive growth in the past year, but with the withdrawal of Andre Cronje at the beginning of the year, Fantom also ushered in its darkest moment, its TVL from the highest The original 11.81 billion US dollars fell to 980 million today, a drop of 91.7%.

In addition, Public chains that were originally incompatible with EVM have successively launched Layer 2 compatible with Ethereum, such as: Near launched Aurora, Polkadot launched Moonbeam, Evmos on Cosmos, Neon on Solana, etc. At present, mainstream public chains are basically compatible with EVM. This will also further strengthen the influence of Ethereum in the encryption field.

2.3 ether Fang merge: from PoW to PoS

Consensus mechanism as a block One of the core components of the underlying components of the chain, it is the gold standard for maintaining the consistency of the blockchain network state, and determines the ownership and distribution of bookkeeping rights. At present, the verification mechanism of the public chain has evolved into many different versions, but in terms of the breadth of application, it is mainly divided into two factions: PoW and PoS. Among them, PoW is mainly represented by Bitcoin, and PoS is mainly represented by new-generation public chains such as BSC and Fantom, as well as the merged Ethereum. For the PoS mechanism, the verifier will no longer need to spend a huge amount of computing power to compete for the right to bookkeeping. It only needs to create and submit a block when it is randomly selected, or verify the block submitted by others when it is not selected. way to get rewards.

The Ethereum merger refers to According to the Ethereum Foundation, the consensus layer is merged with the execution layer, the consensus layer is the beacon chain, and the execution layer refers to the existing level of interaction with Ethereum. The merger is an important step in the transition of Ethereum to the sharding era. After the merger, Ethereum will abandon the PoW part of the existing execution layer and fully turn to the PoS era. At that time, the Ethereum network will be packaged and verified by the stakers, and PoW node miners and computing power mining machines will withdraw from the stage of history.

Ethereum network low Issues such as scalability, high energy consumption, and high GAS seriously restrict its ecological development. Sharding is the optimal solution to the above problems. Promoting the implementation of sharding has become the top priority of Ethereum's future development, and merging is the key to building The premise and foundation of sharding.

Actually, from the current The transition from PoW to PoS has long been reflected in the development roadmap of Ethereum. Among them, the setting of the difficulty bomb is a special mechanism set up for the conversion of the consensus mechanism. The purpose is to promote PoW miners to switch to PoS. Bomb" is a mechanism algorithm that adjusts the difficulty of the chain according to the block time. With the increase of the block height, the difficulty of producing blocks will increase exponentially. The final result is that the miners will quit after measuring the cost without profit. PoW to PoS. Because the merger has been postponed repeatedly, the difficulty bomb has been postponed several times. In June 2022, the launch of the Gray Glacier (Grey Glacier) hard fork also indicates that the merger of Ethereum will not happen until at least September.

After the merger There are three main changes.

First, Ethereum Token Output is drastically reduced. Under the PoW mechanism, Ethereum produces about 12,000 coins per day. After switching to PoS, the daily output is only 1,280 coins, a drop of 89.3%. Coupled with the existence of the burning mechanism of EIP-1559, Ethereum may be fully deflated.

Secondly, the verification is reduced It is beneficial to the further decentralization of the network. Under the past PoW mechanism, verifiers need professional machine hardware, which is difficult for ordinary users to enter. However, under the PoS mechanism, verifiers no longer compete for computing power, and the hardware standards are greatly reduced. Nodes participate in the operation of the node network. Coupled with the emergence of various pledge service providers, the threshold for becoming an Ethereum validator has been further reduced. Finally, greatly reduce energy consumption and gradually move towards the era of carbon neutrality.

PoS mechanism got rid of The continuous pursuit of high computing power mining machines will bring about a sharp drop in demand for electricity. At present, the annual energy consumption of the Ethereum network is about 51.32 TWh, which is equivalent to the energy of a country in Portugal, and the annual production of carbon dioxide reaches 28.63 tons. According to the estimates of the Ethereum Foundation, after the merger is completed, the energy consumption of the Ethereum network will drop by 99.95%, and the energy consumption of each node in a day will be equivalent to the power consumption of a home computer.

Source: Digiconomist

It should be emphasized that this merger is not enough to bring about improvements in scalability and gas costs, and the gradual implementation of sharding will bring about significant changes in the interactive experience.

Section 3 Ethereum Layer 2

In order to expand the performance of the Ethereum network, various expansion solutions have been born in the industry. According to the different levels of the protocols involved, they can be divided into two categories : Layer 1 and Layer 2. Layer 1 refers to on-chain expansion, which usually improves performance by changing the block capacity or underlying data structure. The sharding of Ethereum belongs to Layer 1 expansion. Sharding is further divided into transaction sharding and state sharding. Transaction sharding refers to dividing the calculation of data into different sharding nodes according to certain rules. State sharding refers to storing data separately according to different sharding attributes. Parallel processing in different shards to achieve the purpose of improving network performance.

Layer 2 general chain Down-scaling, that is, data calculations, transactions and other services are migrated to the second layer outside the main chain, reducing the burden on the main chain, so as to achieve the purpose of improving interaction speed and reducing costs. However, how to ensure the availability and security of the second-tier data under the chain will lead to different Layer 2 expansion solutions such as ZK Rollup, Optimitic Rollup, Validium, and Plasma. Before the era of Ethereum sharding has really arrived, Layer 2 will be the The best choice for workshop expansion. At present, Ethereum Layer 2 mainly focuses on two rollup solutions: zero-knowledge rollup (ZK Rollup) and optimistic rollup (Optimistic Rollup).

Rollup, which is a summary transaction The meaning, as the name implies, is to aggregate multiple transaction data and submit it to the main chain at one time, so as to reduce the frequency of interaction with the main chain, achieve the purpose of reducing network congestion and improving network performance. Under the Rollup scheme, it can ensure that the original transaction data is recorded on the Ethereum main chain, and users no longer rely on specific verification nodes. It is the most secure among the above-mentioned Layer 2 schemes.

3.1 ZK Rollup

ZK Rollup was first proposed in 2018 , it relies on zero-knowledge cryptography to ensure the security of funds (it can fully prove that it is the legal owner of certain rights and interests, and does not disclose relevant information, that is, the "knowledge" to the outside world is "zero"), and will The Ethereum main chain is used as a storage medium and the confirmation of the final state, so it also inherits the security attributes of the main chain.

ZK Rollup scheme available Protect users' funds from confiscation and censorship, but the immaturity of ZK Rollup technology and the difficulty of building a universal network also greatly restrict the application of ZK Rollup solutions. For adopters of ZKRollup, it is much more difficult to create a general EVM execution environment than Optimistic Rollup. Typical representative projects of ZK Rollup are zkSync and StarkNet.

zkSync< /b>

zkSync is developed by the Matter Labs team and is fully compatible with the Universal 2.0 of the EVM The test network has been launched. In zkSync 2.0, the L2 state is divided into zkRollup with on-chain data availability and zkPorter with off-chain data availability, similar to StarkNet and StarkEx under StarkWare. There are nearly 100 officially announced ecological projects on the chain, focusing on infrastructure, cross-chain bridges and DeFi fields. In the zkSync network, other Tokens can be used to pay gas instead of ETH.

StarkNet< /b>

StarkNet is a layer 2 expansion general platform developed by StarkWare. Although it belongs to the ZK Rollup family like zkSync, there are some differences in the scheme. The former uses zk-SNARKs, which requires relatively less on-chain storage space and gas fees, while the latter uses zk-STARKs. Even better.

In May StarkNet reached 80 At present, StarkWare is actively testing the L1-L2 bridge starkgate on the official website. It is expected that the StarkNet network will be officially opened in the near future. StarkNet official website shows There are more than 70 ecological projects, mainly concentrated in the DeFi field.

3.2 Optimitic Rollup

Optimistic Rollup does not use zero-knowledge proof , but a fraud proof, which draws on the early Plasma expansion technology and relies on the game between the verification node and the challenger to ensure the security of funds. Therefore, when the verification node returns the final state of the transaction data on L2 to the main chain, it will enter A challenge period of about 7 days. During the challenge period, funds will be locked. If there is a problem with the verified transaction data, other verification nodes can submit fraud proofs and will receive the original verification node’s deposit.

Compared to ZK Rollup, One of the obvious advantages of Optimistic Rollup is that it can be compatible with more complex smart contracts, which also makes the Layer 2 projects that have been launched and have formed an application scale all belong to the territory of Optimistic Rollup, such as:

Optimism