Zero-knowledge (ZK) rollups have become increasingly popular as scalable solutions for the Web3 ecosystem since the introduction of the pioneering ZK-oriented payment solution, zkSync, in June 2020. Currently, there is more than $4.5 billion locked across various ZK rollups, with the emergence of zkEVM Layer 2 chains such as Prom expanding beyond just scaling the Ethereum ecosystem. Privacy, security, simplicity, and compatibility are key features of these innovative solutions.
So, what is driving the growing interest in ZK rollups within the DeFi sector? While addressing Ethereum's scalability challenge remains a core reason for adopting this infrastructure in DApp development, ZK rollups stand out for their emphasis on privacy over liquidity compared to optimistic rollups, catering to the preferences of most Web3 users.
ZK Vs Optimistic Rollups
Both ZK and optimistic rollups aim to alleviate Ethereum's blockchain burden by executing transactions off-chain and submitting them collectively on-chain. This approach enhances Ethereum's scalability by allowing multiple transactions to be processed in a single batch rather than sequentially. The distinction lies in how off-chain transactions are validated and integrated into Ethereum's main network.
Optimistic rollups assume all Layer 2 transactions are valid unless proven otherwise through fraud proofs, whereas ZK rollups utilize ZK proofs (ZKP) to validate all L2 transactions. While each method has its pros and cons, ZK rollups offer instant transaction finality through ZKP verification at submission, unlike the potential 7-day delay in optimistic rollups.
Privacy
In terms of privacy, ZK rollups excel due to ZKP cryptography enabling parties to verify statements without revealing sensitive information. This ensures that transaction details remain confidential, unlike optimistic rollups where all data is public for verification, compromising privacy.
Security
ZK rollups are inherently more secure as every transaction undergoes ZKP validation before reaching the Layer 1 chain. In contrast, optimistic rollups rely on fraud proofs only for contested transactions, raising the risk of fraudulent transactions going undetected if not disputed within the allotted time.
Simplicity and Compatibility
Optimistic rollups offer greater ease of use and compatibility with multiple smart contract operations compared to ZK rollups, leading to higher liquidity locked across optimistic solutions. Major rollup ecosystems like Arbitrum One, Base, OP Mainnet, and Blast are all optimistic, showcasing their widespread acceptance.
zkEVM Rollups' Rising Popularity
Despite initial complexity hindering mass adoption, zkEVM rollups are poised to challenge optimistic rollups as Vitalik Buterin predicted at the ETH Seoul Event in 2022, favoring ZK technology for its transaction finality advantage and scalability potential. Notable developments in zkEVM chains like Prom and Linea indicate a shift towards enhancing privacy, security, and scalability beyond Ethereum’s domain, marking a pivotal transformation in the Web3 ecosystem's landscape.
