Over the past few years, the crypto space has increasingly heard about layer 2 solutions. These L2s continue to attract everyone's attention as more and more projects like Optimism and Arbitrum appear and offering innovative solutions.
However, in 2023-2024, zk rollups, which use zero-knowledge proofs and ensure the correct execution of all transactions within the rollup, took the spotlight. zkSync is one of the popular L2 solutions for Ethereum that has gained attention due to its support for the Ethereum Virtual Machine, which was previously not possible. Today Notum will tell you about the features and operating principles of zkSync Chain, its ecosystem, history, benefits and token.
zkSync Chain: Essentials
zkSync is a layer 2 solution for Ethereum, created to deal with current blockchain issues such as slow speed and high transaction fees. The basis of zkSync is zero-knowledge rollups, which are used to combine off-chain transactions, thereby reducing their cost before sending transaction proofs back to Ethereum.
ZK rollups use advanced cryptographic methods, namely zero-knowledge proofs, which guarantee the correct execution of all transactions within the rollup without the need to disclose its details. After rolling up transaction information, ZK rollups send it to the primary chain for final validation.
Important! The big advantage of ZK rollups is that they can be verified by external validators through the provided evidence, which increases the efficiency of the rollup.
Besides, the chain has a network of ZK Chain Rollups. Thus, other rollups can also validate ZK Rollups. This not only makes rollup network creation easier, but also increases the scalability and compatibility of blockchain systems.
zkSync includes the following parts that make up its core: zkSync Era, zkSync Lite and zkPorter.
- zkSync Era. As mentioned before, zkSync Era is a kind of extended and updated analog version of zkSync that also takes on the function of a zkEVM rollup. zkSync Era was created to implement smart contracts and comfortable interaction between zk-proofs. This frees users from the previous limitations of zk-rollups and provides developers with the ability to migrate their EVM-compatible decentralized applications to zkSync Era. As a result, they not only maintain the proper level of decentralization and security, but also receive lower commissions.
- zkSync Lite. zkSync Lite is a сut-down version of zkSync Era, which simplifies basic payment solutions through zk-rollup architectures. The main advantage of zkSync Lite is its simplicity, which makes functions such as transfers and swaps easily available at a low cost. However, zkSync Lite is not compatible with the Ethereum Virtual Machine, so it is difficult to use for anything other than transfers and swaps. Since most decentralized applications use smart contracts and zkSync Era cannot handle them, its use has been limited. However, despite this, zkSync Lite still made a great contribution to the development of zkSync Era and its implementation.
- zkPorter. The latest product created by Matter Lab is zkPorter, aimed at taking zk-rollup scalability to a completely different level. ZkPorter provides seamless interaction between smart contracts and accounts on both sides. Thus, zkPorter moves the data storage from the Ethereum Mainnet off-chain.
Source: zkSync
zkSync: Short History
Matter Labs is the startup that created zkSync. The project was launched in 2020. At that time, zkSync could provide 300 transactions per second. As the project developed, zkSync 2.0 version was introduced with updated functionality and new tools, such as EVM support and Account Abstraction.
In February 2023, it became known that Matter Labs decided to rebrand zkSync 2.0 into zkSync Era. Now zkSync Chain is the first zero-knowledge EVM for Ethereum. Moreover, the project uses MIT/Apache 2.0 license, which makes zkSync fully open-source.
Interesting fact! Since Matter Labs is a startup, their operations rely heavily on funding. The team managed to raise hundreds of million dollars and attract large investors like the Ethereum Foundation, BitDAO, Placeholder, Dekrypt Capital and others.
How Does zkSync Work?
While there are now a large number of L2 solutions to cope with Ethereum’s congestion, a rollup can be described as a kind of technical implementation of these solutions. Shortly, a rollup is an Ethereum extension that was designed to help with Ethereum's scalability. It puts transactions into one pack and sends them to Ethereum at once.
Interesting fact! Since tokens are locked in L1 contracts, rollups provide low-cost verification.
Even though ZK rollups are pretty similar to Optimistic rollups, the significant difference is verification or the finality method.
- ZK rollups operate on zero-knowledge proofs to verify a batch of transactions and determine them as final on the Ethereum main chain. After that, using SNARK ZK rollup operator combines the proof of validity for every off-chain batch of transactions. Thus, in ZK rollups, transactions are first collected, then evidence is generated, and only after that it is sent to layer 1.
- Optimistic rollups don’t focus on proving the validity of every roll-up. Instead, Optimistic rollups assume that all off-chain computations are valid unless there is evidence to the contrary. However, despite the Optimistic rollups approach, ZK rollups still offer cheaper fees and higher transaction speeds.
Source: zkSync
zkSync Ecosystem
Now zkSync has grown into a fairly extensive ecosystem that offers users bridging tokens, exchanging fiat currencies for crypto coins and much more. The main common ecosystems are bridges, exchanges, fiat on-ramps and block explorers.
- Bridges. zkSync stimulates users and developers to utilize the platform's native bridge or look to partner bridges to transfer tokens from zkSync Era to other networks. Currently zkSync supports 6 bridges, namely ZKsync Bridge, ZKsync Lite Bridge, txSync, LayerSwap, L2Scan Portal and Rhino.
- Exchanges. zkSync also allows users to bridge tokens from centralized exchanges and currently supports options such as Binance, OKX, ByBit, crypto.com and Kraken.
- Fiat on-ramps. To exchange fiat money for cryptocurrency using various payment methods, zkSync offers two fiat on-ramps: Transak and Ramp.
- zkSync explorers. Among other things, zkSync invites users to study information about ZKsync chains, namely explore blocks, transactions, contracts, etc. For this, it offers 6 options - ZKsync Era Block Explorer, Etherscan, L2Scan, Blockscout, Hyperscan and zkScan.
Apart from this, zkSync includes zkSync scan, zkSync wallet and zkSync swap. Besides, it also has a huge number of projects supporting the ecosystem. These include SyncSwap, Tevaera, Koi Finance, ZeroLend, zkVeggies, Derivio, Libera and others. The full list of ecosystem projects can be found here.
Source: zkSync
«The ecosystem is now dominated by DeFi, wallet, bridges, NFTs, and infrastructure projects. The biggest ones onboard are Argent, OKX Wallet, 1Inch Network, Balancer, Yearn.finance, Curve and others» - Hacken.io
Why Use zkSync Chain?
- Transaction cost. As a layer 2 solution for Ethereum, zkSync primarily solves blockchain problems such as slow speed and high transaction fees. Currently the transaction cost on zkSync is only $0.01.
- ZK chains. zkSync uses networked modular rollups and validiums that can be added or expanded to handle increased transaction volumes at no additional cost.
- Interoperability. zkSync and its ZK chains offer seamless and native interoperability, enabling reliable communication and asset transfer between chains.
- EVM Compatibility. ZKsync is a first EVM-compatible zero knowledge rollup that supports generalized EVM smart contracts. Thus, if the user already has EVM smart contracts, then transferring dApps to ZKsync Era will be quite simple.
- Safety. Unlike other Ethereum scaling methods with weaker security, ZKsync Era uses zero-knowledge proofs which provide greater confidence in security.
- Decentralized values. zkSync network fully supports the decentralization approach and strives to be fully open-source and offer complete decentralization to its users and developers.
zkSync Token and Airdrop
In order for ZKsync to remain censorship-resistant and reliable, it must be decentralized and run by dedicated community members. Thus, ZKsync has released a protocol token that allows holders to not only vote on protocol upgrades but also introduce them. Besides, a ZK token is used to pay network fees in the ecosystem using ZKsync’s native account abstraction.
Source: ZK Nation
«Through governance-driven protocol upgrades, the community can evolve ZK to introduce staking and other functions» - Blog ZK Nation.
The $ZK token was released on June 11, 2024 with a total supply of 21,000,000,000 ZK. Currently, zkSync crypto ranks 94th in market capitalization according to CoinMarketCap.
Source: ZKnation Docs
As for the zkSync airdrop, there are now two ways in which wallets can qualify for the 17.5% airdrop:
- Users (89%). ZKsync users who bridged funds to ZKsync Era and met at least one of the seven selection criteria are eligible to receive an airdrop.
- Contributors (11%). Developers and other Individuals who have contributed to the ecosystem also qualify for the airdrop.
All information about ZK coin airdrop, eligibility criteria and allocation can be found here.
Source: ZKnation Docs
Notum’s Verdict
zkSync is a fast growing and ever-expanding network secured by math. As a layer 2 solution for Ethereum, zkSync aims to solve current blockchain problems such as slow speed and high transaction fees. Due to zero-knowledge rollups, which are used to merge off-chain transactions, zkSync reduces the cost of transactions to $0.01 and increases their speed.
It offers users token bridging using supported bridges and exchanges, fiat to crypto exchange using fiat on-ramps and block explorers for more information about ZKsync chains. Other popular projects supporting the ecosystem include SyncSwap, Tevaera, ZeroLend and others.
Now the zkSync network continues to expand and already has more than $1.32B TVL. With its network of ZK chains, native interoperability and user-centric approach, zkSync is well positioned to become a leading player in the world of blockchain networks.