A Primer on Rollup Stages | Layer 2 Review
A Primer on Rollup Stages | Layer 2 ReviewQuick Reads and Hot Links Covering the People and Projects Who Are Scaling EthereumDear Frens, In the ongoing quest for blockchain scalability and efficiency, Layer 2 solutions continue to demonstrate their potential, with notable developments such as Polygon Nightfall, zkSync, Optimistic Rollups, and sidechains like Polygon PoS and XDai/Gnosis. However, these solutions have also introduced new security challenges, which are being addressed through rigorous audits, testnets, adoption of best practices, and transparent governance. In this week's editorial, we continue from where we left off in the previous issue, shedding more light on Vitalik Buterin's proposed milestones for rollup maturity, which he categorized into three stages: full training wheels, limited training wheels, and no training wheels. This framework serves as a valuable tool for evaluating the decentralization progress of rollups. As the Layer 2 ecosystem continues to evolve, it's essential to stay informed on the latest developments, proposals, and projects to better understand the future of Ethereum's scalability and efficiency. So read on as we bring to you the latest stats, proposals, project watch, ecosystem updates, and more from around the world of Ethereum’s Layer 2. Contributors: Lucent1, anointingthompson1.eth, Warrior, jengajojo, Tonytad, Boluwatife, Kornekt, WinVerse This is an official newsletter of BanklessDAO. Please subscribe and share to help us grow our audience as we fulfill our mission to build user-friendly crypto onramps. 🗞️ Ecosystem Updates⛓️ Frax Launches Layer 2 Network Fraxtal With Partner Apps 🆕 Sushi Plans to Launch Decentralized Derivatives Exchange Susa on Layer N 🔀 Layer 2 Startup LightLink Secures 4.5 Million USD in Seed Round ➿ Herodotus, StarkWare Unveil 'Cairo verifier' to Scale Layer 3s on Starknet ⚡ Starknet Foundation Unveils STRK Token Distribution Plan to Nearly 1.3 Million Eligible Wallets ⭕ zkSync Eyes Lower Fees, 'bigger batches’ After Ethereum's Dencun Upgrade 🔒 Polygon Labs Wants to Help Convert EVM Blockchains Into Validiums via 'type 1 prover' 🔥 Hot NewsRedbelly Network Forges Strategic Partnership with TProtocolThe acclaimed World’s ONLY Public Purpose-Built Real-World Asset Tokenization Platform — Redbrlly Network — has announced a groundbreaking partnership with TProtocol, a decentralized Real World Asset (RWA) lending protocol. This strategic collaboration promises to unleash a tsunami of innovation, propelling both platforms to new heights of success and solidifying their positions as trailblazers in the dynamic world of RWA tokenization. TProtocol's cutting-edge V2 introduces a game-changing TLending mechanism that focuses on permissioned RWA tokens. This revolutionary approach empowers RWA institutions to borrow USDC against their tokens in separate pools, complete with tailored risk parameters, interest rate models, and liquidation methods. Simultaneously, users can lend their USDC in an over-collateralized manner to gain access to safe real yields backed by RWA tokens. This partnership represents a bold step toward unlocking the full potential of blockchain technology and ushering in a new era of financial innovation. To get more information on this electrifying partnership, check out the thread below👇 🏛 Governance⭐ Featured ProposalsArbitrum Foundation Transparency Report 2023From the proposal: “The Arbitrum Foundation and the ArbitrumDAO are 10 months old and it has been an amazing year for the community. As part of the Arbitrum Foundation’s commitment to transparency and giving the community insight into the Foundation’s operations, today the Foundation is sharing the first annual transparency report.” The report is structured based on their technical advancement, grants, strategic partnerships, and educational and community initiatives, you might want to check it out. 💬 Proposals in DiscussionArbitrum
OptimismPolygon
MantleCeloA Primer on Rollup StagesAuthor: Kornekt Currently, we have a vibrant ecosystem of L2 solutions, each using different approaches to solve the scalability trilemma. But as we’ve highlighted in our previous L2 review releases, a paradox arises: the very quest for enhanced scalability has introduced unintended centralization. One of the ways this centralization manifests is in the use of centralized sequencers. However, the concerns extend beyond sequencers. In our previous issue, the author introduced the idea of decentralization or maturity stages of rollups based on a framework inspired by Vitalik's proposed milestones for rollups taking off training wheels. These “training wheels” are the initial form of centralized mechanisms that rollup projects employ. In this article, we’ll be digging a little deeper into these maturity stages. The Stages FrameworkThe stages framework is a tiered system that defines rollup maturity levels. According to Vitalik’s forum post, the idea is to clarify the extent to which rollups minimize trust in specific humans versus trust in code. There are three stages in this framework: Stage 0, Stage 1, and Stage 2. The ultimate goal remains to achieve "Stage 2" decentralization, characterized by trustless operation, although the stages framework does not necessarily reflect rollup security. Attaining a stage designation requires meeting specific criteria, but according to a detailed analysis by L2BEAT,
Stage 0, Stage 1, and Stage 2Stage 0: Full Training WheelsIn this stage, essential control of the rollup is in the hands of the operators. According to L2BEAT, some rollups in this category include Optimism, zkSync Era, and Polygon zkEVM. Here’s a quick breakdown of key features of rollups in this stage:
Stage 1: Limited Training WheelsSome rollups that pass as Stage 1 according to L2BEAT include Arbitrum and zkSync Lite. Key features of Stage 1 rollups include:
Stage 2: No Training WheelsKey features of this stage include:
Why Reaching Stage 2 Is So ImportantReaching Stage 2 for L2 solutions brings several critical advantages related to the core blockchain ethos of trustlessness and decentralization. Layer 2 solutions should aim for a Stage 2 designation for several key reasons:
In summary, reaching Stage 2 signifies a leap towards a truly decentralized and trustless L2 ecosystem. It fosters transparency, user autonomy, and security, ultimately contributing to the long-term viability and scalability of blockchain technology. While all these are necessary, L2 projects are still to follow a progressive approach to take off the “training wheels”. This ensures long-term sustainability of the projects and the ecosystem as a whole. 📈 DataTotal Value Locked on L2s moves past $25 billion!Top Ten Projects by Total Value Locked:🔭 Project WatchArbitrumTop Projects by TVLOptimismTop Projects by TVLzkSyncTop Projects by TVLzkEVMTop Projects by TVL🔥 L2 Fees and Costs UpdateTransaction Fees as of February 14, 2024: |
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