There\u2019s a version of the future that\u2019s tantalizingly possible in which Ethereum becomes the base layer for pretty much everything.<\/b><\/p>\n
Recent advances in a technology called zero-knowledge Rollups \u2014 from StarkWare, Polygon and zkSync \u2014 enable the blockchain to move from fewer than 20 transactions per second to\u2026 well, an infinite number of TPS.<\/p>\n
In theory, it would allow the entire world\u2019s financial system to run on Ethereum.<\/p>\n
\u201cI think it\u2019s theoretically possible,\u201d explains Declan Fox, product manager for rollups at Consensys, which provides Ethereum infrastructure and apps like MetaMask. \u201cWe have the technology to achieve that kind of throughput necessary.\u201d<\/span><\/p>\n \u201cWith recursive rollups and proofs, we theoretically can infinitely scale.\u201d<\/span><\/p>\n<\/blockquote>\n He adds it obviously hasn\u2019t been proven in production yet, \u201cso that\u2019d be the next step.\u201d<\/span><\/p>\n The tech is so new and so promising that soon after it became viable, Ethereum rearranged its entire roadmap to take advantage of it. This week\u2019s Merge is arguably the least interesting bit of the coming changes.<\/span><\/p>\n \u00a0<\/p>\n \u00a0<\/p>\n \u00a0<\/p>\n At its most basic, the process employs high-level mathematics to generate a tiny validity proof that verifies that a whole bunch of other transactions has been carried out correctly. Instead of putting all the transactions on the slow and creaky blockchain, you just record one proof in a transaction.<\/span><\/p>\n \u201cThis technology lets you send a very succinct proof that asserts that a computation was done correctly \u2014 even when you weren\u2019t watching, which I think is the most magical aspect,\u201d he explains.<\/span><\/p>\n \u201cWhat validity proofs deliver, they deliver integrity; they let me know that the right thing was done by others \u2014 that someone processed 10,000 transactions, even when I wasn\u2019t watching, and they didn\u2019t steal my money. That\u2019s what they deliver.\u201d<\/span><\/p>\n<\/blockquote>\n Tens of thousands of transactions being compressed into a single transaction on Ethereum is impressive enough, but the magic doesn\u2019t stop there.<\/span><\/p>\n Validity proofs work a little bit like fractals \u2014 the closer you look, the further into the distance they stretch. You can take 10 validity proofs \u2014 each representing 10,000 transactions \u2014 and generate an entirely new validity proof verifying that those other 10 proofs are correct.<\/span><\/p>\n Suddenly you have 100,000 transactions rolled up into one. This is called a \u201crecursive proof,\u201d and you can just keep doing it over and over again.<\/span><\/p>\n \u201cIt is a proof of proving. And so, you can further compound the savings because each time you generate a proof, you\u2019ve compressed the process of verifying computation. So, basically, you can compress again and again.\u201d<\/span><\/p>\n \u00a0<\/p>\n \u00a0<\/p>\n \u00a0<\/p>\n \u00a0<\/p>\n Our interview is held the same week that StarkWare puts recursive proofs into production. The zkSync project, which uses the slightly different zkSNARKS instead of zkSTARKS starks, has implemented its own version of <\/span>recursive proofs<\/span>.<\/span> StarkWare has already rolled up as many as 600,000 NFT mints into a single transaction on ImmutableX, and Ben-Sasson says they\u2019ll be able to cram 6 million NFTs into a single transaction soon and then \u201c60 million with more engineering and tweaking.\u201d<\/span><\/p>\n While there are still some problems to overcome, this type of scaling capability puts crypto back in the game for everyday payments and microtransactions \u2014 such as paying a few cents to read a paywalled article rather than being forced to take out a monthly subscription. Long hampered by high fees and 10-minute wait times for payments to go through, crypto finally has the opportunity to fulfill Satoshi Nakamoto\u2019s original vision of becoming peer-to-peer cash.<\/span> Ethereum co-founder Vitalik Buterin told attendees at last month\u2019s Korea Blockchain Week that scaling meant payments were back on the table:<\/span><\/p>\n \u201cIt\u2019s a vision that has been, I think, forgotten a little bit, and I think one of the reasons why it has been forgotten is basically because it got priced out of the market.\u201d<\/span><\/p>\n<\/blockquote>\n Infinite scaling on Ethereum means some people \u2014 mostly Ethereum people, to be fair \u2014 can no longer see the justification for competing layer-1 blockchains like Solana or Cardano. Delphi Digital calls this the \u201c<\/span>Monolithic\u201d<\/span> view of crypto\u2019s future as opposed to a \u201cmultichain\u201d view.<\/span><\/p>\n It doesn\u2019t necessarily mean there won\u2019t be any competitors, just that it\u2019s likely that there will be far fewer of them as the space coalesces around a single general-purpose execution environment. (For the record, Delphi Digital Labs is throwing its research efforts into the Cosmos ecosystem, not Ethereum.)<\/span><\/p>\n \u00a0<\/p>\n \u00a0<\/p>\n \u00a0<\/p>\n \u00a0<\/p>\n Chatting downstairs at ETH Seoul, I ask Ben-Sasson if he can see any need for any blockchain other than Ethereum in the future.<\/span><\/p>\n His bespectacled face breaks into a grin.\u00a0<\/span><\/p>\n \u201cI can argue both sides because one side says: \u2018Is there a need for more than one internet?\u2019 And we know the answer is \u2018Hell no.\u2019 It would be a completely stupid idea to have two internets.\u201d<\/span><\/p>\n \u201cOne side of me says that that is the case. The other one says that maybe because this has all kinds of macroeconomic considerations, maybe it\u2019s a little bit more like fiat currencies, where in that aspect, you probably want more experimentation.\u201d<\/span><\/p>\n \u00a0<\/p>\n \u00a0<\/p>\n \u00a0<\/p>\n \u00a0<\/p>\n Sergej Kunz, co-founder of DeFi aggregator 1inch Network is less circumspect. He sees Ethereum dominating the entire space, with layer-2 \u2014 and layer-3 recursive-proof \u2014 solutions running on top of it and benefiting from its decentralization and security.<\/span><\/p>\n \u201cI don\u2019t think any layer 1 apart from Ethereum will get a huge share on the market,\u201d he says.<\/span><\/p>\n \u201cYeah, I see layer-2 solutions on top of Ethereum (because) Ethereum is kind of a safe haven and super decentralized after proof-of-stake.\u201d He adds:<\/span><\/p>\n \u201cI love also that the Ethereum guys tried to keep it as simple as possible, the main chain. Other layer 2s above it can be very complex, providing proofs to the \u2018safe\u2019 chain that everything\u2019s fine.\u201d<\/span><\/p>\n<\/blockquote>\n Kunz says 1inch is eagerly awaiting the launch of zkSync\u2019s mainnet by the end of the year and is even toying with running its own layer 3 for 1inch Pro.\u00a0<\/span><\/p>\n \u201cWhat I heard is possible; the plan in the future is that it would be possible to have a layer 3 above the layer 2,\u201d he says.<\/span><\/p>\n \u201cWe\u2019re thinking about spinning up our own network for 1inch to manage because of our centralized entity in Switzerland\u2026 kind of only allow specific addresses to interact in this compliant DeFi environment. And it makes sense to spin up our own network and all those who can pass KYC\/AML can participate in this network.\u201d<\/span><\/p>\n \u201cAnd we can use zkSync technology for layer 2\u2026 In our layer 3, we would have also\u2026 our throughput would be affected by the throughput of layer 2.\u201d<\/span><\/p>\n Polygon also has a variety of zk-Rollup solutions in development but was, unfortunately, unable to put forward an interviewee in time for this piece. \u00a0<\/p>\n \u00a0<\/p>\n Stay tuned 👀 \u2014 Abdel#1559 a.k.a The StarkPiller ✨ 🐺 (@dimahledba) September 1, 2022<\/a><\/p>\n<\/blockquote>\n \u00a0<\/p>\n \u00a0<\/p>\n Obviously, Bitcoiners will be getting extremely annoyed reading about Ethereum eating the world with zk-Rollups, but here\u2019s the thing: Bitcoin could also scale massively using zk-Rollups, and StarkWare and various others have been researching that possibility.<\/span><\/p>\n Although it lags behind in smart contract capability, Bitcoin may be able to underpin the world\u2019s financial system if it fully embraces rollups, too.<\/span><\/p>\n But there is a major problem: Ben-Sasson says it\u2019d require a fork to allow a Stark verifier. The block size wars of 2017 and the jealous guarding of the original code and principles by Bitcoiners to ensure its integrity suggest the community may be unwilling to embrace change.<\/span><\/p>\n Ben-Sasson says he was orange-pilled way back at the San Jose Bitcoin conference in 2013 and that former Bitcoin core devs Greg Maxwell and Mike Hearn had expressed strong interest in exploring ZK tech. He adds: <\/span><\/p>\n \u201cIt\u2019s not a technological problem. It\u2019s only a political problem. But it\u2019s a big political problem.\u201d<\/span> In fact, zk-Rollups can theoretically scale any blockchain out there, but having no capacity constraints anymore undermines the primary appeal of competing layer 1s, which is that they are either faster or cheaper than Ethereum.<\/span><\/p>\n There are major advantages to using the most decentralized and secure chain available. And if Bitcoin is out of the picture, Ethereum\u2019s slow and cautious development could be about to pay off.<\/span><\/p>\n \u00a0<\/p>\n \u00a0<\/p>\n \u00a0<\/p>\n \u00a0<\/p>\n As Ethereum stans are fond of pointing out, it\u2019s easy enough to scale blockchains if you cut corners on reliability (like Solana, which has been <\/span>knocked offline<\/span><\/a> half a dozen times in recent months) or just require all the nodes to spend millions buying super fancy computers to run the network (like Internet Computer).<\/span> The embrace of proof-of-stake in the Merge has been carefully designed so that a poor farmer in Ecuador running an ancient secondhand laptop can easily validate transactions on the network. (No one knows why and how a poor farmer would get the 32 ETH required to join the network with an old laptop, but it is possible.) But anyone can join a decentralized pool with a mere 0.1 ETH.<\/span><\/p>\n In theory, this should make it more decentralized and secure than any other smart contract chain (although not everyone <\/span>agrees<\/span>). Ethereum already has 420,000 validators and encouraging network effects, in terms of users, developers and apps, than any other blockchain.<\/span><\/p>\n \u00a0<\/p>\n \u00a0<\/p>\n \u00a0<\/p>\n \u00a0<\/p>\n So, why deploy on a competing layer 1, when it\u2019s instead possible to use a layer 2 (or layer 3) solution with infinite scaling on Ethereum and spin it up as fast as you need while still inheriting Ethereum\u2019s underlying decentralization and security?<\/span><\/p>\n We are not quite at that point yet, however, and while zk-Rollups are a key component of scaling, they don\u2019t solve all of Ethereum\u2019s problems by themselves.<\/span><\/p>\n \u201cStarknet solves the problem of computation. It doesn\u2019t solve the problem with data availability,\u201d Ben-Sasson explains.<\/span><\/p>\n To simplify this to very broad brushstrokes: Basically, a zk-Rollup still has to verifiably publish enough data on-chain about the transactions it performed off-chain so that if the rollup stopped working or fell into the hands of super villains or something, then another group could step into the gap and figure out who owed what to who \u2014 i.e., recreate the \u201cstate.\u201d This is an important part of what makes blockchains decentralized and trustless.<\/p>\n While they only publish a very small amount of data on-chain, blockchains like Ethereum are extremely limited in the amount of data they can include in each block.<\/p>\n There are a few different plans to deal with the data availability bottleneck. There\u2019s Ethereum Improvement Proposal 4488, which reduces the cost of posting data on chains with the aim of supercharging rollups. There\u2019s <\/span>proto-danksharding, <\/span>which introduces blobs of data and makes data availability cheaper again, and then there\u2019s actual danksharding (named after Ethereum dev Dankrad Feist), which will allow a bunch of chains to work in parallel and enable data availability sampling (which allows blockchain nodes to verify that data for a proposed block is available without having to download the entire block).\u00a0<\/span><\/p>\n \u00a0<\/p>\n \u00a0<\/p>\n Subscribe for thoughtful explorations and leisurely reads from Magazine.<\/p>\n<\/div>\n By subscribing you agree to our Terms of Service and Privacy Policy<\/a><\/div>\n<\/div>\n \u00a0<\/p>\n \u00a0<\/p>\n If you\u2019re not a hardcore dev and that sounds like a bunch of technobabble, the important thing to note is that Ethereum blocks currently carry 50\u2013100kB of data, which will increase to around 1MB when proto-danksharding is enabled (sometime next year), and 16MB under full danksharding (sometime in the future). Or to put it another way, expect a 10x increase in the current capability within a year, and 160x in a couple of years.<\/span><\/p>\n The upgrades are designed to move Ethereum from a monolithic and slow blockchain, where every validator computes every transaction and stores the history of the chain, to something more like a peer-to-peer style torrenting model where the work is dispersed rather than duplicated.<\/span><\/p>\n (Note that the above is not a comprehensive breakdown of the many upgrades coming to Ethereum, in the hope of keeping this story vaguely coherent.)<\/span><\/p>\n \u00a0<\/p>\n \u00a0<\/p>\n .@VitalikButerin<\/a> claims that #Ethereum<\/a> will be able to to process \u201c100,000 transactions per second\u201d, following the completion of 5 key phases:<\/p>\n \u2022 The Merge A quick breakdown of what each stage means for $ETH<\/a>. 👇 pic.twitter.com\/FnaWww8mHZ<\/a><\/p>\n \u2014 Miles Deutscher (@milesdeutscher) July 22, 2022<\/a><\/p>\n<\/blockquote>\n\n\n\n
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<\/span>One of the pioneers of zero-knowledge proofs \u2014 or validity proofs as he prefers to call them \u2014 is StarkWare co-founder Eli Ben-Sasson. He worked on the problem for two decades, helping nurture it from an abstract theoretical concept \u2014 \u201csomething that is completely galactic and impossible, not enough atoms in the solar system to record even one such proof\u201d \u2014 down to something that can efficiently be generated on a laptop.<\/span><\/p>\n\n
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Do you even need another blockchain, bro?
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Documentation is coming.#Bitcoin<\/a> and #STARK<\/a> proofs in action. pic.twitter.com\/BoLW4lex3i<\/a><\/p>\nThe original P2P cash: Bitcoin<\/h4>\n
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<\/span><\/p>\nWarning: Technobabble<\/h4>\n
The best of blockchain, every Tuesday<\/h3>\n
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\u2022 The Surge
\u2022 The Verge
\u2022 The Purge
\u2022 The Splurge<\/p>\nHold on, when did this all happen?<\/h4>\n
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