The Ethereum Scaling War

Imagine you’re waiting in line. The lines moving slowly and realistically you just want to pay for what you got and leave. Now imagine getting charged to just be in line and if you paid just a bit more, your place in line would move up.

That’s been the state of ETH as the price of gas has risen ever higher as network congestion has increased. But Jeff, does that mean that ETH will only be for rich crypto whales in the future?

Bam, in comes the Layer 2’s or L2 for short and we have two-ish major solutions.

1) Optimistic Rollups:

Really appropriately named. They assume transactions are good to go unless someone says otherwise meaning transactions are double-checked if a validator issues a challenge. They also combine a bunch of transactions off-chain and just post a summary on the main chain thus relieving the load.

Main players in this space are Optimism ($OP) and Arbitrum ($ARB)

2) ZK- Rollups (Zero-Knowledge Rollups)

Not as catchy of a name but still sounds fancy. They use complex math to verify transactions off-chain and then post a summary to the main chain. By taking the computations offchain, it also relieves network congestion.

Projects include zkSync ($ZK) , StarkNet ($STRK)

The issue is that ZK-Rollups are inherently more secure. Validity proofs (essentially a mathematically proven guarantee) are submitted and available onchain immediately whereas an optimistic relies fully on the participants to monitor for bad actors and invalid transactions.

If you’ve ever seen how mall security performs in your average retail store, you’ll understand how relying on people keep the baddies out is an inherently bad idea.

Time will tell as crypto users vote with their coins. All eyes on the TVL numbers.