Nikolas Sargeant
Zero knowledge-proof rollups, known as ZK rollups, are getting greater traction as a blockchain scaling technology thanks to their ability to eliminate a critical bottleneck associated with decentralized networks - namely their ability to scale and their high costs.
Layer-1 blockchains such as Ethereum struggle to meet demand due to their inability to support high volumes of transactions, and ZK rollups are just one of a number of scaling systems that have been proposed to save the day. Ethereum is slow and expensive, with users often complaining they have to pay several dollars and wait hours for transactions to be processed.
What Are ZK Rollups?
ZK rollups work by processing transactions on a separate, faster blockchain known as a Layer-2 network, before the data of multiple transactions is ported back to the parent blockchain (Layer-1) at a fraction of the cost. In this way, users can benefit from increased speed and lower costs, while inheriting the security of the L1 blockchain.
One of the aspects that differentiates ZK rollups from other scaling solutions, such as optimistic rollups and sidechains, is their use of ZK proofs, which enable information to be verified without revealing the actual transaction data. The concept was first introduced by MIT students Shafi Goldwasser and Silvio Micali in a research paper in 1985, but has only recently found its niche with blockchain, where it has increasingly been implemented in real-world applications such as privacy and security-focused networks.
ZK proofs power privacy coins such as Zcash, but they can also be integrated with rollups to create a privacy-preserving scaling solution that’s also fast and inexpensive. Because they use ZK proofs, ZK rollups allow users to withdraw their funds after making a transaction without delay. This is not possible with optimistic rollups, where the funds must remain on the network until the dispute resolution period closes.
Instant withdrawals are possible because ZK rollups tap into their ZK proof technology to submit regular validity proofs to the smart contracts on the parent blockchain, confirming that the L2 transactions are accurate and verifiable. So transactions can be completed immediately and the funds withdrawn straight away, which means decentralized applications can implement superior business models based on having greater liquidity available. ZK proofs also allow ZK rollups to reduce the volume of transaction data, further aiding scalability.
The Next Evolution: ZK Rollups-as-a-Service
The advantages provided by ZK rollups come at the cost of increased complexity, making them challenging to implement in decentralized applications. Because they’re so complex, they can only be implemented by skilled developers who must spend a lot of time maintaining the system.
The network structure of ZK rollups also demands that sophisticated and expensive hardware is used to validate transactions. This introduces the risk of ZK rollups becoming susceptible to censorship, as the validation sequencing is more likely to be centralized with such a high barrier to entry for validators.
These challenges have proven to be insurmountable obstacles for many developers. As a result, ZK rollups, like many technologies before them, are evolving to an “as-a-service” business model, where much of the underlying infrastructure is pre-built for developers.
One of the main pioneers of the ZK rollups-as-a-service concept is Lumoz, which has created the infrastructure required to help developers launch a zkEVM blockchain within minutes, without requiring extensive knowledge of how ZK rollups work under the hood. At the same time, Lumoz is looking to minimize the risk of centralization in the validation sequencing process through its ZK-PoW concept, building a diverse network of miners to participate in the verification of transactions on zkEVM blockchains.
Lumoz is now focused on popularizing ZK RaaS, which it aims to do by expanding the number of L1 blockchains it supports. At the same time, it’s planning to add more functionality to the ZK-Rollup Launchbase platform, in order to simplify zkEVM chain deployments further.
Although the concept of ZK RaaS is still a nascent one, Lumoz has already grown to encompass more than 100 projects across areas such as DeFi, GameFi and NFTs. It’s providing a compelling alternative to developers who desperately need a way for their dApps to scale without increasing the complexity they must deal with.
Not only do they get a quick and easy way to launch ZK rollups that can be customized to their needs, but they also benefit from greater security by tapping into Lumoz’s wider network where mining is decentralized, meaning a much-reduced security risk.
