Over time, people have debated if Blockchain is a trustworthy approach. While it allows you to carry out secure transactions from a decentralized platform, at the same time, it also raises concerns about gas prices (transaction fees) going higher when there's an increase in activity in the blockchain network.
Scaling Blockchains to carry out more transactions at a lower gas price can be the tipping point for the mass adoption of Web3. It can make smart contracts a priority across many industries like finance, insurance, real estate, logistics, retail, and more. That's why Blockchain research and development have their eye on Blockchain scalability.
Rollups stand as a solution to this problem, they can take the whole transaction process off-chain, bundle numerous transactions into one transaction, and distributes the fees of that one transaction among many users. That's how they reduce the gas price and settle the transaction quickly. ZK-rollups and Optimistic rollups are two of these kinds, and today we're going to dig deep into ZK-rollups and understand how they can be the future of smart contracts.
What are ZK-Rollups?
Zero-knowledge rollup is a layer-2 scaling solution that takes a bunch of transactions off-chain, roles them up together into one transaction, and submits that to the parent chain. These rollups tap into zero-knowledge proof because the smart contracts in the parent network need to verify the accuracy of their transactions.
Zero-proof also doesn't allow revealing any data except the information necessary to prove the accuracy of transactions, which means all the sensitive data stays safe, and that makes ZK-rollups a privacy-focused solution. Aside from privacy, ZK-rollups also reduce the waiting period before some can withdraw their funds.
ZK-Rollup Vs Optimistic Rollups
As I've mentioned earlier, Optimistic Rollup is the second type of layer-2 scaling solution that, unlike ZK-Rollups, does not employ the concept of offering validity proof. They have a totally different approach where all the transactions are assumed to be correct. But it offers a window of limited timeframe where users can challenge the accuracy of a rollup transaction by computing fraud-proof.
But are these rollups ready for decentralized finance (DeFI)? Well, Optimistic Rollups have a similar execution model to that of Ethereum Virtual Machine (EVM) and since a lot of DeFi apps use Ethereum, Optimistic rollups have an advantage over ZK-rollups here.
Another important question that pops up is how quickly can you withdraw funds from these layer 2 transactions. Since Optimistic Rollups offers a window for challenges, it's obvious that you can not withdraw funds before that. It usually takes up to seven days before the funds are available for withdrawal. But on the other hand, ZK rollup lets you withdraw funds immediately since it uses validity proof to verify the accuracy of the transactions instantly.
But the final question is, which one is better? Well, as of now, Optimistic Rollups is leading on the scoreboard since it's a better option for DeFi projects because it is EVM compatible. But due to the use of cryptographic proofs, ZK rollups are considered more secure and scalable so they are considered to be better in the long run. And we don't know yet, but there's a high chance that ZK-rollups will catch up with the EVM compatibility thing in its recent updates.
Reshaping the Blockchain Landscape with ZK-rollups
We see ZK-rollups as a reassuring solution that can scale blockchains without compromising their main characteristics. Another benefit of choosing Roleups is you will be able to customize a layer 2 network as per your needs and create a high-tech environment while still having a decentralized layer as your base.
We all know that if Web3 wants to thrive in the future, it needs to become capable of handling a large number of transactions. And despite ZK-Rollups being a relatively new technology, it is already being adopted across the crypto industry. ZKSync, ZKSwap, ZKTube, and Polygon Hermez are some examples of solutions that work on ZK-Rollups.