Polygon (MATIC), an Ethereum layer-2 solution provider, has finally revealed the much-anticipated scaling update that has been in the works for quite some time. The beta launch of its zero-knowledge Ethereum Virtual Machine (zkEVM) mainnet is scheduled for March 27.
Polygon said in a blog post that was published on February 14 that after three and a half months of “battle testing,” the platform would be ready for the launch of the mainnet the following month.
It was first released as a testnet in December of the previous year and has since been marketed as “seamless scalability for Ethereum.”
Since the beginning of this decade, work on the scaling technique known as zk-rollup has been continuously progressing. In that span of time, the Polygon zkEVM system has accomplished a number of noteworthy goals, as mentioned by the team.
Among them are the implementation of more than 5,000 smart contracts, the production of more than 75,000 zk-proofs, the creation of more than 84,000 wallets, and the completion of two public third-party audits.
The group said that maintaining a secure environment is their first concern, which is “why Polygon zkEVM has been subjected to a battery of testing and audits,” as they put it.
This technique makes use of zero-knowledge proofs, which are cryptographic confirmations that, in the context of scaling, allow platforms to verify huge volumes of transaction data before bundling them up and confirming them on Ethereum.
There are other teams than Polygon that are toiling away at a zkEVM solution. Scaling provider zkSync is creating a solution that is comparable to EVM with its zkPorter product. This product moves key transaction data off-chain.
Scroll, another company that specializes in scaling solutions, is also developing a zkEVM solution in conjunction with the Ethereum Foundation’s Privacy and Scaling Explorations group.
Additionally, the Ethereum Foundation is providing financing for a project known as Applied ZKP. This project’s objective is to create a zk-rollup that is compatible with the EVM.
The group elaborated on the relevance of the technology by claiming that real EVM-equivalence indicates that Ethereum may be scaled “without having to settle for half-measures.”
The easiest approach to grow Ethereum is to maintain the present Ethereum ecosystem, which means that the code, tools, and infrastructure all need to function seamlessly together. And that is precisely what the Polygon zkEVM project hopes to do.”
The scaling technology offers large reductions in the costs of individual transactions. According to the researchers, the expenses of providing proof for a huge batch of hundreds of transactions have been reduced to around $0.06, while the costs for providing proof for a straightforward transfer are less than $0.001.
In November 2021, the company that is responsible for Polygon, Matter Labs, completed a Series B funding round that was lead by Andreessen Horowitz and received $50 million. The funds will be used to develop zk-Rollups that are interoperable with EVMs.
The scaling solution for Ethereum’s layer 2 To far, StarkWare has processed 327 million transactions and coined 95 million nonfungible tokens (NFTs). StarkWare has announced intentions to open source their proprietary Starknet Prover under the Apache 2.0 licence. This will take place in the near future.
The prover is an essential piece of software that Starkware employs in order to wrap up hundreds of thousands of transactions and condense them into a brief cryptographic proof that is then recorded on the Ethereum blockchain.
“Here at Stark Industries, we consider the Prover to be the technological equivalent of a magic wand. “It does a fantastic job of generating the proofs that enable inconceivable scalability,” said Eli Ben-Sasson, president and co-founder of Starkware. “It allows unprecedented growth.”
Starkware has come under fire from the cryptocurrency community as well as solutions that compete with it, such as ZK Sync and Polygon, for the fact that it retains ownership of the intellectual property (IP) that underpins its technology. This runs counter to the open source and interoperable ethics that underpin blockchain technology.
By making the prover open source and releasing it under the Apache 2.0 licence, any other project or network, as well as producers of games or databases, will be allowed to utilise the technology, modify the code, and personalise it as they see fit. The technology didn’t become widely available until 2020, but ImmutableX, Sorare, and dYdX are already making use of it.
Avihu Levy, head of product at Starkware, was hesitant to commit to a time period for open-sourcing the prover but said that it will take place after the introduction of the token and the decentralisation of Starknet itself. Nevertheless, he acknowledged that it would be doable throughout this year.
Levy said that the choice to open source the prover demonstrated that Starkware was becoming more confidence in its technology. He also stated that it would allow projects to become more confident about using it as an essential component of their protocols.
“Within StarkEx, this is something that is sometimes referred to as vendor lock-up or lock-in. Therefore, the commitment to StarkEx was not merely a commercial commitment; rather, it was a commitment to the company’s technological development,” he stated.
“This is a clear indication that you will have everything at your disposal to operate it without relying on Starkware,” the speaker said.
Starkware’s programming language and EVM rival, Cairo 1.0, as well as Papyrus Full node, have both been open-sourced, and the company is now in the process of open-sourcing their newest sequencer.
The Starkware Sessions conference was kicked off on Sunday in Tel Aviv by Ben-Sasson. According to the event’s organisers, it is the biggest layer 2 conference that has been hosted up to this point.
Around 500 visitors and engineers were in attendance when he made the statement. “This is a watershed moment for scaling Ethereum,” he said. It will establish Stark technology as a public asset that can be put to use for the common welfare of all people, which is the proper position for it.
2021 was a big year for airdrops, with leading Ethereum DeFi projects offering generous rewards to early users.
Layer 2 solutions and bridges look set to take center stage in 2022.
Experimenting with other ecosystems such as Cosmos, Solana, and Avalanche is also a solid strategy to receive token rewards.
Share this article
URL Copied
Following a record-breaking year for token airdrops, Crypto Briefing has compiled another list of protocols likely to airdrop tokens in 2022.
DeFi Airdrops in 2021
To say 2021 was a good year for airdrops would be something of an understatement.
In January, Crypto Briefing published a list of 10 DeFi projects that were likely to airdrop tokens to early users. So far, three of the 10 listed have distributed tokens, netting early adopters thousands of dollars worth of digital assets.
In June, Instadapp was the first on our list to reward its users, airdropping 11,000,000 INST tokens to Maker DAO, Compound, and Aave users on Ethereum and Polygon. Next up, the on-chain trading platform dYdX announced its own token in August, dropping 7.5% of the total DYDX token supply to early users. Finally, despite publicly announcing that it wasn’t planning an airdrop, Paraswap dropped 150 million PSP tokens to frequent users in November.
Of the seven that haven’t rewarded users with tokens this year, several still look promising. MetaMask has continually hinted that an airdrop could be coming but has been vague on who will be eligible or when it’s likely to happen. Other picks, such as Zapper and DeFi Saver, have been less vocal but are still favorites for a future airdrop.
As always, with airdrops, nothing is guaranteed because factors like eligibility criteria are so hard to predict, even moreso after a series of Sybil attacks targeting airdrops were discovered earlier this year. However, the previous record of airdrops has proven that those who consistently get involved early are likely to be handsomely rewarded.
Here, we list our top 10 Ethereum-based projects that could airdrop a token in 2022.
zkSync
zkSync is a Layer 2 scaling solution for Ethereum. It uses ZK-Rollups and is one of several Ethereum scaling projects to make our list. Pioneering users can transfer ETH to the zkSync 1.0 mainnet, where they can mint NFTs or test out dApps preparing to launch on the network.
To qualify for a potential future airdrop, users can try transferring ETH to zkSync’s mainnet wallet and make swaps on the testnet version of UniSync on the zkEVM.
Notably, zkSync has confirmed that it plans to decentralize through a governance token, which many speculate will be distributed through an airdrop to early users.
StarkNet by StarkWare
Like zkSync, StarkNet is another scaling solution built using ZK-Rollups. StarkWare, the company behind StarkNet, provides the technology used to scale several existing DeFi and NFT protocols, such as dYdX, DeversiFi, Sorare, and Immutable X.
The StarkWare team has been tight-lipped on whether it plans to launch a token but has not outright dismissed the idea. On the StarkWare Discord server, team members frequently respond to questions about a token with “no comment.” One of StarkWare’s key initiatives is to decentralize StarkNet, and a popular method for doing so is to issue a governance token.
StarkNet Alpha recently started allowing developers to build apps on the network ahead of a general release in 2022. To prepare, users can download Argent, one of the first StarkNet compatible browser extension wallets.
As StarkWare has refrained from weighing in one way or the other, many to believe that a token, and possibly an airdrop for early adopters, is likely in the future.
ZigZag
The next step for those who have transferred ETH to zkSync or StarkWare’s StarkNet is to make some trades on ZigZag.
ZigZag is the first decentralized exchange built on zkSync and StarkNet Alpha. It’s still in the early stages of development and only supports a limited number of trading pairs but appears to have a significant head start over other protocols planning to launch on ZK-Rollup-based Layer 2 solutions.
Rumors are circulating that early adopters could potentially receive an airdrop in the future if the exchange decides to release a token.
Arbitrum
Continuing the theme of Ethereum Layer 2 solutions, Arbitrum, an Optimistic Rollup, is next on the list for a potential token airdrop.
The speculation for an Arbitrum airdrop comes from when Good Bridging, a popular token bridge to Avalanche, airdropped 100% of its token supply to those who had used the bridge to transfer funds. Some speculate that users of the Arbitrum bridge could also expect a similar payout in the future.
However, Ed Felten, co-founder of the company behind Arbitrum, Offchain Labs, has publiclystated that he doesn’t expect an Arbitrum token. This hasn’t stopped people from speculating, though. There’s evidence that people have attempted to Sybil Attack a future Arbitrum airdrop by sending small amounts of Ethereum through the Arbitrum bridge from multiple wallets.
Optimism
Optimism is another Optimistic Rollup project aiming to scale Ethereum. Like Arbitrum, there is speculation of an airdrop for those who bridge tokens over to Optimistic Ethereum and interact with DeFi applications. Synthetix, Synapse, and Uniswap have all deployed on Optimism so far; making trades on these protocols could also result in airdrop eligibility.
Despite no word from the Optimism team, many are hopeful for a token airdrop for early adopters.
Hop Protocol
As several Ethereum Layer 2 solutions are rumored for upcoming airdrops, a bridge linking them together also looks like a good candidate. Hop is a scalable rollup-to-rollup bridge linking Ethereum to Arbitrum, Optimism, Polygon, and xDai.
There are rumors that both using the Hop Protocol bridge and supplying liquidity and staking liquidity provider tokens could qualify users for a future airdrop.
For those wanting to speculate on airdrops from Arbitrum and Optimism, using Hop can give exposure to all three at once. Users can send funds to Arbitrum and then use Hop to bridge them to Optimism, saving on Ethereum gas fees.
In addition to a potential Hop Protocol governance token, those who bridge funds may also qualify for other airdrops. Instrumental Finance recently announced an airdrop for those who participated in cross-layer and cross-chain strategies between Aug. 5 and Nov. 25, with Hop Protocol users eligible.
Bored Ape Yacht Club
Switching gears from Ethereum Layer 2 solutions, the next rumored airdrop is for holders of one of the most coveted NFT collections: Bored Ape Yacht Club. The project’s Twitter accountdiscussedthe possibility of launching a token back in October, stating that a Q1 2022 launch is likely.
It’s not confirmed whether Bored Ape Yacht Club NFT holders will receive a token airdrop, but it seems likely. For those who can’t afford the eye-watering prices of Bored Apes on the secondary market, there’s potential for holders of its spin-off projects, Bored Ape Kennel Club, and Mutant Ape Yacht Club, to also be eligible for an upcoming airdrop.
CowSwap
CowSwap is the first decentralized exchange built on the Gnosis V2 Protocol. It lets users buy and sell tokens using gasless orders settled either peer-to-peer or by any on-chain liquidity source.
Airdrop rumors have been circulating on Twitter and within the CowSwap and Gnosis communities for some time. An improvement proposal outlining a protocol token has also gained traction on the Gnosis forum.
If CowSwap does decide to launch a token, it’s possible that holders of the Gnosis Protocol token could be in line for the airdrop, too.
Clipper
Clipper is another newly-launched decentralized exchange to make the airdrop list. It positions itself as the exchange for retail traders, specializing in swaps under $10,000 in value to keep slippage low.
A Clipper airdrop is more speculative than most on this list, but there are a couple of clues. Besides not yet having a token, Clipper has announced it plans to create a DAO, so it may launch a token in the future to decentralize the protocol.
Using the exchange to trade or provide liquidity could make users eligible for future token rewards. Those wanting to avoid the high gas fees on Ethereum can make swaps on Polygon to gain exposure to this potential airdrop.
Unstoppable Domains
Following the surprise airdrop from Ethereum Name Service in early November, speculation is rising over whether other blockchain domain providers will follow a similar path.
Unstoppable Domains provides “.crypto” domain names on Ethereum and Polygon, similar to how ENS provides “.eth” names on Ethereum. The protocol currently does not have a token, making it a prime candidate for a future airdrop.
Unlike ENS, Unstoppable Domains only requires a one-time payment to purchase a domain with no renewal fees. Unstoppable Domain owners could end up being eligible for a future airdrop if the protocol decides to issue a token.
Closing Thoughts
At the start of 2021, DeFi protocols appeared to be the most promising prospects for token airdrops. As expected, many of the most lucrative airdrops came from DeFi projects on Ethereum.
For 2022, Ethereum Layer 2 solutions and cross-chain bridges are now favorites ahead of a big year of releases. Aside from the names mentioned in this list, testing out any additional Ethereum scaling solutions or interoperability protocols over the next year is likely a good bet for maximizing the chances of hitting an airdrop. Moreover, besides Ethereum, exploring other ecosystems such as Cosmos, Avalanche, and Solana is also likely to yield rewards for early protocol adopters.
Token rewards aside, getting familiarized with these upcoming technologies is an excellent educational investment in and of itself. While being an early adopter can pay off handsomely, those doing so should also be aware of the risks involved with using protocols that are still in the early stages of development.
Disclosure: At the time of writing this feature, the author owned ETH, SOL, and several other cryptocurrencies.
Share this article
URL Copied
The information on or accessed through this website is obtained from independent sources we believe to be accurate and reliable, but Decentral Media, Inc. makes no representation or warranty as to the timeliness, completeness, or accuracy of any information on or accessed through this website. Decentral Media, Inc. is not an investment advisor. We do not give personalized investment advice or other financial advice. The information on this website is subject to change without notice. Some or all of the information on this website may become outdated, or it may be or become incomplete or inaccurate. We may, but are not obligated to, update any outdated, incomplete, or inaccurate information.
You should never make an investment decision on an ICO, IEO, or other investment based on the information on this website, and you should never interpret or otherwise rely on any of the information on this website as investment advice. We strongly recommend that you consult a licensed investment advisor or other qualified financial professional if you are seeking investment advice on an ICO, IEO, or other investment. We do not accept compensation in any form for analyzing or reporting on any ICO, IEO, cryptocurrency, currency, tokenized sales, securities, or commodities.
See full terms and conditions.
Ten DeFi Protocols Rumored for Token Airdrops
Following 1inch’s well-received token airdrop, Crypto Briefing experimented with several other protocols that may be next to launch a token. Here, we list our top ten. Early Users Reap Airdrops…
ZK-Rollups and the Path to Scaling Ethereum
As the cost of using Ethereum increases, the need to scale the network has become more apparent than ever. Zero-Knowledge Rollup technology promises to lower gas fees without compromising on…
Arbitrum Launch: Layer 2 Ethereum Unpacked
Scalability has been Ethereum’s biggest challenge as its popularity rises. One of the key Layer 2 solutions hoping to solve the issue, Arbitrum, has now launched for developers. The Road…
Audience Survey Win A $360 Subscription To Pro BTC Trader
Answer the questions below and share your email for a chance to win. Every month, 5 people will receive a $360 1-year subscription to Pro BTC Trader. Free. We’re doing…
High gas fees on Ethereum have highlighted the urgent need for scaling solutions.
While the scaling solutions of today have seen success, they suffer from problems with composability and decentralization.
ZK-Rollups improve on existing Layer 2 networks by offering enhanced interoperability and security.
Share this article
URL Copied
As the cost of using Ethereum increases, the need to scale the network has become more apparent than ever. Zero-Knowledge Rollup technology promises to lower gas fees without compromising on decentralization and security.
Ethereum’s Scalability Issues
High gas fees have become a major problem for Ethereum.
As transaction fees are paid in ETH, the cost of using the network rises when the price of the asset does.ETH is up 460% this year, which means the cost of transactions has also increased by 460% in U.S. dollar terms.
Transaction fees also depend on the level of network congestion. As there is huge demand for Ethereum block space today, gas fees are also high.
The high cost of using the network has priced many users out of DeFi, NFTs, and even participating in DAOs. Many crypto enthusiasts have migrated to other Layer 1 blockchains such as Solana and Avalanche because of Ethereum’s expense.
Ethereum: Median Transaction Gas Price (Source: Glassnode)
Over the last few years, several scaling solutions have been developed to help relieve congestion on Ethereum and reduce the cost of transactions. Polygon launched in 2019 and was arguably the first Ethereum scaling solution to gain significant traction. The network uses a scaling solution called Plasma, which offloads transactions from the main Ethereum blockchain into a dedicated sidechain. Many Ethereum-native DeFi applications such as Curve and Aave have launched on Polygon this year.
While Polygon has successfully attracted users by offering low fees, it is often criticized for not being a true scaling solution. Polygon uses a Proof-of-Stake consensus mechanism governed by its ownset of node validators. This means that it doesn’t use Ethereum mainnet to validate transactions so is generally regarded as less secure and decentralized.There are only 100 validators governing Polygon. According to data from Polygonscan, the top validator address accounts forover 27% of the network.
Top 25 Polygon Validators by Blocks (Source: Polygonscan)
Over the past year, another type of scaling solution called rollups has generated a buzz in the Ethereum community. Currently, every transaction on Ethereum includes all the computational data needed when interacting with a smart contract. As block space is limited, Ethereum can easily become congested, resulting in slow transaction confirmations and high gas fees.
Rollups offer a way to outsource computational data and send validity proofs back to Ethereum mainnet. This saves block space and allows for transactions to be bundled together, further reducing the amount of data committed to mainnet. When transactions are bundled together, gas fees are split between many users. Rollups offer users near instant transaction speeds and can reduce fees by a factor of 50 to 200 while maintaining the security and decentralization of Ethereum mainnet.
What Are Zero-Knowledge Rollups?
Rollups come in two flavors:Optimistic and Zero-Knowledge. Optimistic Rollups assume that transactions sent back to the base chain are legitimate. Transactions only get rejected if someone watching the chain can prove that they are fraudulent by submitting a fraud proof. In other words, Optimistic Rollups take an “innocent until proven guilty” approach to validating transactions.
Conversely, Zero-Knowledge Rollups, also known as ZK-Rollups, generate cryptographic proofs that demonstrate transactions are legitimate when sent back to mainnet. Transactions are only accepted on Ethereum after the cryptographic proof is validated. Unlike Optimistic Rollups, ZK-Rollups take a “guilty until proven innocent” approach to validation.
Currently, Optimistic Rollups have seen the most adoption, thanks in part to the ease of developing applications on them. Optimistic Rollups can support full smart contract functionally straight out of the box, and developers can code applications using Solidity, Ethereum’s native programming language. Data from L2beat shows that the biggest Optimistic Rollup today, Arbitrum, has attracted over $2.5 billion of total value locked in DeFi applications. It hosts many of the most popular DeFi applications on Ethereum.
However, Optimistic Rollups face a few challenges. Because of their approach to validating transactions, funds sent back to Ethereum mainnet are subject to a dispute period of up to a week. This inconveniences users and breaks composability.
While Optimistic Rollups have improved on Plasma-based solutions like Polygon, they are generally regarded as inferior to ZK-Rollups. Optimistic Rollups have a dispute period and offer scalability improvements up to a factor of 77. ZK-Rollups have no dispute period, and they offer improvements up to a factor of 500.
However, ZK-Rollups have not yet reached the same level of compatibility as their Optimistic counterparts. Because ZK-Rollups have validity proofs accompanying every transaction, their technology is more difficult to construct. ZK-Rollups have been developed to handle simple tasks like direct transfers and trading. While integrating smart contract functionality is possible, it has proven a lot more difficult.
As recently as this year, Ethereum co-founder Vitalik Buterin predicted that development of fully composable ZK-Rollups would take several years. However, developers are ahead of schedule. Several ZK-Rollups are getting ready to deploy solutions that are mutually composable and interoperable, even across rollups.
The development of ZK-Rollups will allow for a shared communication framework between Ethereum mainnet and multiple Layer 2 networks, where networks can share liquidity and overcome the biggest adoption challenges Layer 1 blockchains face.ZK-Rollup-based networks will not need to compete for liquidity in order to deliver efficient trading through decentralized exchanges, and will instead be able to work cooperatively to scale Ethereum.
ZK-Rollups also have another unique feature. Transactions become cheaper as more people use them due to the way fees are calculated for each batch of transactions. The cost to send batch isn’t subject to much variance, so gas costs can be split among more users as more transactions are bundled in a batch. ZK-Rollups can bundle an almost infinite amount of transactions, so gas fees for transactions could be reduced to fractions of pennies with enough users. This feature is called validity proof amortization.
While Ethereum is still facing scalability issues, several developers are already in the process of deploying Layer 2 ZK-Rollup networks, promising full composability and compatibility between smart contracts, other Layer 2 solutions, and the Ethereum Virtual Machine.
Types of ZK-Rollup
There are currently two different types of ZK-Rollup being utilized in Ethereum scaling solutions.
The first and most widely used type of ZK-Rollup uses ZK-SNARKs—succinct non-interactive arguments of knowledge. SNARKs were the first type of zero-knowledge proof discovered; the early blockchain project Zcash used them as early as 2016. SNARKs form the majority of ZK-Rollup developer libraries and published code and are regarded as a strong option for Ethereum scaling projects.
One big drawback of SNARKs is that they requirean initial creation event of the keys that are used to create the proofs required for transactions. If the keys in the trusted setup event are not destroyed, they could be used to create new tokens out of thin air or falsify transactions.
The most prominent SNARK-based scaling solution today is the Matter Labs’ zkSync project. Launched in June 2020, zkSync is promising 2,000 transactions per second in its current iteration, with hopes of achieving higher throughput in the future. In May, the platform started working toward smart contract deployment in an EVM-compatible environment with the launch of its zkEVM testnet.
The main focus of zkSync has been making the transition from Ethereum mainnet as easy as possible. Those wanting to develop on zkEVM can write smart contracts using Solidity, Ethereum’s programming language. Matter Labs recently raised $50 million to aid development of zkSync in its Series B funding round led by Andreessen Horowitz. Additionally, the company has partnered with several Ethereum DeFi blue chips such as Curve Finance, Aave, and 1inch.
The other type of ZK-Rollup uses STARKs—scalable transparent arguments of knowledge. STARKs offer an advantage over SNARKs as they rely completely on hash functions and do not require a trusted setup. This means that STARKs are theoretically more secure than SNARKs, which has made them a favorite of the Ethereum Foundation.
StarkWare is the first company to use STARKs to scale Ethereum and is currently the main driving force behind the development of STARK-based technology. StarkWare has created a Turing-complete programming language for STARK-based ZK-Rollups called Cairo. It used Cairo to create its first product, the StarkEx protocol.
StarkEx is an application-specific scaling solution that is currently being used by several Ethereum projects, including dYdX, Immutable X, Sorare, and DeversiFi. StarkWare is about to release StarkNet, a permissionless ZK-Rollup network that lets developers build and launch applications directly on Layer 2. StarkNet is aiming to become atrue, decentralized, multi-app scaling solution.
StarkEx is planets, StarkNet will be constellations (Source: StarkWare)
ZK-Rollups are about to change the way the crypto community uses Ethereum. As high-speed, low-cost networks like zkSync and StarkNet materialize, transactions on Ethereum mainnet will increasingly be outsourced to Layer 2. This should allow Ethereum to move closer to its vision of becoming a scalable, secure, and decentralized blockchain network.
Disclosure: At the time of writing this feature, the author owned ETH and several other cryptocurrencies.
Share this article
URL Copied
The information on or accessed through this website is obtained from independent sources we believe to be accurate and reliable, but Decentral Media, Inc. makes no representation or warranty as to the timeliness, completeness, or accuracy of any information on or accessed through this website. Decentral Media, Inc. is not an investment advisor. We do not give personalized investment advice or other financial advice. The information on this website is subject to change without notice. Some or all of the information on this website may become outdated, or it may be or become incomplete or inaccurate. We may, but are not obligated to, update any outdated, incomplete, or inaccurate information.
You should never make an investment decision on an ICO, IEO, or other investment based on the information on this website, and you should never interpret or otherwise rely on any of the information on this website as investment advice. We strongly recommend that you consult a licensed investment advisor or other qualified financial professional if you are seeking investment advice on an ICO, IEO, or other investment. We do not accept compensation in any form for analyzing or reporting on any ICO, IEO, cryptocurrency, currency, tokenized sales, securities, or commodities.
See full terms and conditions.
Loopring Jumps 19% Amid Ethereum ZK-Rollup Hype
Loopring is one of several ZK-Rollup solutions built to help Ethereum scale. Loopring Posts 19% Rally The crypto market appears to be gearing up for a “ZK season.” Loopring, one…
Ethereum Scaling Solution zkSync Raises $50M
Matter Labs, the company developing Ethereum Layer 2 scaling solution zkSync, has raised $50 million in a Series B funding round led by renowned venture capital firm Andreessen Horowitz. Matter…
What is a Crypto Airdrop: Why Projects Airdrop Crypto
Crypto airdrops occur when new tokens are freely distributed to different wallets in order to drive initial growth and build a community. They represent a popular marketing tactic that new projects use to spread…
Ethereum ZK-Rollup Developer StarkWare Raises $50M at $2B Valuation
ZK-Rollup developer StarkWare has raised $50 million in a Series C funding round that values the firm at $2 billion. The company plans to launch StarkNet Alpha on Ethereum mainnet…
Tether (USDT) has now launched on Hermez Network, an Ethereum scalability solution based on the zk-rollup concept. Rollups provide a way of batching or “rolling up” transactions to lighten the load on the Ethereum network.
The key to rollups is the concept of data availability, which means that the state data of the rollup is always fully available on-chain. In practice, this means that the Ethereum network knows the token balances of all user accounts on the Hermez rollup after every transaction, and this knowledge can be used to rapidly withdraw funds and distribute them to their new owners in the event of malfunctions.
Zk-rollups can be considered as separate “blockchains” that are entirely reliant on the layer-one network for security. Through the use of zk-SNARKs, the Hermez rollup publishes regular proofs to the Ethereum network that verify its correctness. Due to the succinct property of SNARKs, the underlying data can be almost arbitrarily large, while the proof will remain constant in size. This makes it perfect for scalability applications, as the Ethereum network is able to conclusively prove that the network is working as intended with just a fraction of the data that the rollup itself processed.
By launching USDT on Hermez, Tether hopes to alleviate the pressure on Ethereum gas fees, where the Tether contract is consistently among the highest gas users. As fees for token transfers consistently stay above $10 on Ethereum — with exchanges upping their withdrawal charges in response — the market has significantly diversified on its Tether usage.
Transferred value in USDT on Ethereum, Tron and Omni (Bitcoin). Source:Coinmetrics.
Tether on Tron’s network has reached parity with Ethereum in terms of value transferred — a significant achievement for Tron and a source of concern for Ethereum supporters. Arguably, the most significant contributing factor to Tron’s rise is the support from a number of exchanges such as Binance, Huobi, OKEx and many others that are traditionally associated with Asia and Asian traders. Whatever users may think of Tron, few can argue with its low fees and significant acceptance.
Hermez provides an Ethereum-native alternative to Tron, though it adds to OMG Network’s Plasma, which, so far, seems to have failed to gain significant traction. Hermez can currently be accessed by using MetaMask, binding to the user’s Ethereum wallet. Transacting on the network requires performing a deposit transaction from the Ethereum main chain, after which the funds become available on the rollup. However, without a meaningful number of possible destinations for the funds, Hermez risks getting stifled by competition from other sidechains and layer-one networks.
The Hermez team is fully aware of this predicament and is working to integrate with as many exchanges as possible, but it remains to be seen whether its efforts will be successful.
Hermez Network, a Layer 2 scaling solution for Ethereum, has launched on mainnet.
The network uses zk-rollup technology to enable high-speed, low-cost transactions.
Hermez launched its own wallet interface, accessible through MetaMask.
Share this article
Ethereum’s Layer 2 welcomes a new arrival: Hermez Network.
Hermez Network Launches
Hermez Network has gone live on Ethereum mainnet.
The Layer 2 project shared news of the update in a blog post earlier today. In it, they wrote:
“We aim to help with Ethereum’s congestion peaks, and lower the entry barrier to decentralized finance. This is just the beginning, but the network will be able to process vast amounts of transactions, moving billions of dollars worth of digital assets.”
Hermez Network is a form of rollup that works by grouping transactions together to create SNARKs—succinct non-interactive arguments of knowledge. These SNARKs then get settled on the Ethereum base layer as one transaction. Rollups are useful for processing transactions at a higher speed and lower cost than on the base chain, and they take two forms: ZK-Rollups and Optimistic Rollups.
Hermez Network is an example of a ZK-Rollup, though Optimistic Rollups such as Optimism have also recently turned heads as the costs of using Ethereum hits record highs. Yesterday, Uniswap detailed its plans to go live on Optimism “shortly after” its V3 update goes live on May 5.
Hermez Network warned that there’s a risk of “possible bugs” in the code in the announcement post. The solution was tested and audited on Ethereum’s Rinkeby testnet before launching on mainnet. They wrote that users “should treat it as an early version and should expect that there can be bugs.”
Hermez Network has launched abug bounty program to foolproof the code, paying up to 100 ETH for critical issues. There’s also a wallet interface for interacting with the solution. It’s accessible through the widely used Web3 wallet MetaMask.
The blog post notes that users can now create accounts, deposit funds, send transactions and withdraw funds through the network. It will initially support ETH, USDT, DAI, wBTC, and HEZ.
Disclosure: At the time of writing, the author of this feature owned ETH and several other cryptocurrencies.
This news was brought to you by Phemex, our preferred Derivatives Partner.
Share this article
The information on or accessed through this website is obtained from independent sources we believe to be accurate and reliable, but Decentral Media, Inc. makes no representation or warranty as to the timeliness, completeness, or accuracy of any information on or accessed through this website. Decentral Media, Inc. is not an investment advisor. We do not give personalized investment advice or other financial advice. The information on this website is subject to change without notice. Some or all of the information on this website may become outdated, or it may be or become incomplete or inaccurate. We may, but are not obligated to, update any outdated, incomplete, or inaccurate information.
You should never make an investment decision on an ICO, IEO, or other investment based on the information on this website, and you should never interpret or otherwise rely on any of the information on this website as investment advice. We strongly recommend that you consult a licensed investment advisor or other qualified financial professional if you are seeking investment advice on an ICO, IEO, or other investment. We do not accept compensation in any form for analyzing or reporting on any ICO, IEO, cryptocurrency, currency, tokenized sales, securities, or commodities.
The Ethereum bull run is in full swing, the soft launch of the Optimism scaling solution will likely fuel continued appreciation. Ethereum Gets Optimistic Boost Ethereum had a huge year…
What is Dogecoin?
So what is the story behind DOGE? How did it become the asset of choice for a group of anti-establishment retail traders in January 2021, and what are the chances…
Uniswap V3 Offers Far Higher Exposure, Lower Risk For Staking
Uniswap has revealed an overview of V3 of the DEX which is due to launch on May 5, described by Uniswap as “the most flexible and capital-efficient AMM ever designed.”…
Matic Rebrands as Polygon to Take on Polkadot Network
Part of Matic’s rebranding to Polygon will also see the project working on a system similar to Polkadot on Ethereum, using multichain architecture for scaling. Matic Rebrands to Tackle Polkadot…
Hermez Network has announced on Wednesday the launch of its zk-rollup mainnet release. This means that the network is now open for users, who can benefit from the rollup’s much lower transaction costs than Ethereum.
Zk-rollups use zero knowledge proofs to verify the correctness of a large batch of transactions. An outside ecosystem executes these transactions and generates proofs for them, which are then posted directly on the Ethereum blockchain. The result is a saving of over 10x in terms of block space, with Hermez transactions weighing just 10 bytes on the main chain, compared to more than 100 bytes for a standard Ether transfer.
Hermez supports several major tokens including Ether (ETH), Wrapped BTC (WBTC), Tether (USDT), Dai and HEZ, Hermez’s token.
The zk-rollup requires depositing funds to a smart contract and withdrawing them to use in the Ethereum mainnet. Unlike optimistic rollups, however, funds can be withdrawn immediately from the layer two. In Hermez’s case, there are still some precautionary limitations to ensure a smooth launch. Pol Lanski, lead of ecosystem development at Hermez, told Cointelegraph:
“It’s an automated volume limitation on withdrawals that is implemented in the smart contracts as an additional checkpoint to identify the network’s anomalous behavior. This limitation will kick in automatically only when a sudden high volume of funds withdrawal is detected, and the objective is to give the developer team some time to verify the system and determine whether the funds are being withdrawn legitimately.”
Hermez comes several months after ZkSync, a similar solution designed by Matter Labs, hit the market. While it has seen adoption on platforms like Gitcoin, a mixed crowdfunding and grants platform, there were few other integrations.
Hermez is launching on mainnet with an integration with Bitfinex and Tether already under their belt. Antoni Martin, co-founder of Hermez, told Cointelegraph:
“We have several exchanges committed to implementing Hermez and a good number of them in direct contact with us, playing with the testnet.”
Nonetheless, fostering layer two adoption seems to be harder than first anticipated. Payments-only systems can only be used for transferring funds between exchanges or paying for products in centralized ecosystems that support layer-two. They cannot be directly used with DeFi, as it would require users to withdraw and redeposit funds each time, partially defeating the purpose of the rollup. Still, with the Tether and USDC contracts being among the largest “gaz guzzlers” on the network, even a payments-only rollup can significantly alleviate pressure on Ethereum fees.
