Exploration of Ethereum Layer 2 Scaling Solutions

Ethereum, as one of the most active blockchain platforms today, supports numerous decentralized applications, from DeFi to NFTs, and its ecosystem is thriving. However, this has been accompanied by issues such as network congestion, soaring transaction fees, and extended confirmation times, which severely affect user participation enthusiasm.

To address these challenges while maintaining the decentralized nature of the main chain, the community proposed the Layer 2 (L2) scaling solution. The core idea of L2 is to move computation and transactions from the main network (L1) to a second-layer network, submitting only the final results to the main network. This approach not only improves transaction efficiency and reduces costs but also inherits the security of the main network.

Currently, the more well-known Layer 2 solutions include Rollups and sidechains. Rollups can be further divided into Optimistic Rollups (OP-Rollups) and Zero-Knowledge Rollups (ZK-Rollups).

Optimistic Rollups

OP-Rollups perform transaction computation and state updates on the Layer 2 network, and then batch submit the compressed transaction data to the mainnet. This approach assumes that all transactions are valid by default, similar to the legal principle of presumption of innocence in the real world. This greatly improves the speed and efficiency of transaction confirmations.

After submission, validators have seven days to raise objections. If issues are found, a fraud proof can be submitted for verification by the L1 smart contract. Once a problematic transaction is confirmed, all transactions in that batch and thereafter will be rolled back, malicious nodes will be punished, and the whistleblower will receive a reward.

In fact, the deterrent effect of the “fraud proof” mechanism far exceeds its actual punitive effect. Almost no nodes have submitted fraud proofs, let alone confirm that nodes have committed malicious acts. This is thanks to the thorough testing of the project itself, the strict penalty mechanism, and the economic and credit losses from malicious acts far exceeding the potential gains.

Compared to node maliciousness, users more often encounter service interruptions caused by network fluctuations or software bugs. The main disadvantage of OP-Rollups is that the seven-day challenge period may affect the flow of funds and the potential risk of centralization.

Zero-Knowledge Rollups

Unlike OP-Rollups, ZK-Rollups require a validity proof to be attached when submitting data. It also processes transactions off-chain, but before officially submitting, it needs to compute the validity proof first.

ZK technology emerged before blockchain, but its application scenarios have always been limited. The advantage of blockchain lies in its ability to confine complexity within smart contracts, requiring only the verification of on-chain data and computations, without relying on centralized organizations or individuals.

The complexity of ZK-Rollups lies in the need to compile complex logic circuit diagrams based on transaction data and execution logic, and then generate quickly verifiable results through cryptographic calculations. This process typically requires specialized compilers and verifiers.

Cost Considerations of Layer 2

Although Layer 2 aims to reduce the interaction costs for users on Layer 1, they also have their own costs.

The costs of OP-Rollups mainly come from two aspects: the transaction fees for submitting compressed data to L1 and the operational costs of L2 nodes. Fortunately, Ethereum’s EIP-4844 proposal has significantly reduced the costs of L2 interacting with the mainnet. In addition, maintaining nodes requires locking up a large amount of funds, which may cause investors to miss out on other opportunities.

The main cost of ZK-Rollups comes from the consumption of computing resources. Generating zero-knowledge proofs requires a large amount of computing resources and specialized hardware. At the same time, it also has to bear the transaction fees for submitting data on-chain. The requirements for specialized hardware may lead to a more centralized network.

Summary

OP-Rollups and ZK-Rollups are important solutions in the Ethereum ecosystem to address scalability challenges. With the implementation of upgrades like Ethereum EIP-4844, the data publishing costs for L2 have significantly decreased, which will further unleash the potential of both solutions. In the future, the continuous evolution of these technologies will bring more possibilities to the Ethereum ecosystem.