What is zkSync? What does it offer?

What does zkSync offer?

zkSync is the first EVM-compliant Layer 2 (L2) ZK-rollup-based EVM solution built on top of the Ethereum blockchain.

The implementation is based on zkEVM technology designed to scale smart contracts by combining zero-knowledge proof (ZKP) and Ethereum Virtual Machine (EVM) capabilities.

This symbiosis enables fast, low-cost, and confidential transactions using L1 security. The technical specifications of zkSync allow for up to 2000 TPS, and transaction fees can drop to 1/100 of the fees on the underlying layer, i.e. the Ethereum network.

Who developed zkSync?

Matter Labs, a company founded in Berlin by Alexander Vlasov and Alexey Glukhovsky in 2018, is behind the creation of the solution. According to official figures, the zkSync initiative has total funding of $458 million by the end of 2022, with investors including venture capital firms such as Placeholder, DragonFly Capital, 1kx, Hashed, Dekrypt Capital, Andreessen Horowitz (a16z), Blockchain Capital, as well as the investment divisions of crypto exchanges Crypto.com, OKX, and Bybit.

In June 2020, Matter Labs launched the first public version of zkSync — 1.0. The second version, 2.0, was opened to the public at the end of October 2022. In February 2023, the project team rebranded: zkSync 2.0 was renamed zkSync Era and zkSync 1.0 was renamed zkSync Lite.

A key feature of the zkSync Era launch was support for EVM-compatible smart contracts based on ZK technology — zkEVM. According to Matter Labs, the project received more than 150 requests for deployment on the network ahead of the 2.0 launch. Projects such as Chainlink, SushiSwap, Uniswap, Aave, Argent, 1inch, Gnosis and Curve have expressed interest.

What are the differences between zkSync and Optimism?

There are two main types of rollups in the L2 solution market: Optimistic and ZKP. The key difference between them is the way transactions are validated. In the former, only those that someone challenges are validated; in ZKP, every transaction is validated.

In practical terms, this means that to combat fraudulent transactions in “optimistic” rollups, transaction validation can take weeks. Zero-disclosure networks, on the other hand, provide near-instant proof of the absence of “harmful” transactions.

Consequently, this affects the speed of withdrawal of assets to the Ethereum core network. In the first variant, the operation time can be about two weeks, in the second — up to three hours.

Optimistic includes such networks as Arbitrum, Base and Optimism. Starknet, Linea and zkSync projects are based on ZKP.

What is the uniqueness of zkSync and what is Hyperchains?

The base-level implementation of the zkSync Era protocol (formerly 2.0) includes support for account abstraction technology. This can bring a completely different user experience from the usual blockchain networks.

The network’s default account holders have access to the following features: paying fees with any token and creating wallets without cid-phrases. As stated on the zkSync website, biometric verification and social recovery with the help of family, friends or a third party can be implemented for network accounts. Users can also turn to the option of authorization via a Web2 profile when applications set up access to the zkSync network for their customers who don’t own ETH addresses.

Like the Optimism team developing a unique ecosystem based on OP Stack technology solutions, zkSync has its own global vision — Hyperchains.

Hyperchains are fractal instances of zkEVM developed on the basis of ZK Stack. In essence, they are identical copies of networks built in a modular way depending on the developers’ needs and interconnected by L1-L2 bridges.

The Hyperchains functionality implies the possibility of creating L3 solutions by delegating some operations to the L2 layer developed on the basis of zkSync.

Will zkSync have a native token?

Information about the native token is available in documents on the Matter Labs website. For example, in the description of account-related mechanisms, zkSync’s own digital asset acts as a controller of account data availability.

Matter Labs CEO Alexey Glukhovsky also confirmed the need for the token as a decentralization tool for zkSync. According to him, the need for it will arise when the network reaches the necessary stability indicators. According to Glukhovsky’s estimates, this should happen in early to mid 2024.

How is the zkSync ecosystem evolving?

As of November 2023, total blocked funds (TVL) in zkSync totaled more than $186.3 million according to Defillama.

In September 2023, zkSync surpassed the Ethereum network in the number of transactions per second. And the flagship DEX SyncSwap became the leader in terms of new user acquisition rates, surpassing the 1 million target for September 2023 and overtaking Uniswap and PancakeSwap.

The L2 protocol zkSync surpassed Ethereum not only in the number of transactions per second, but also in their total volume. In September 2023, its users conducted 32.5 million transfers compared to 32.3 million on the Ethereum core network.

In September 2023, the zkSync team noted that the ecosystem had nearly 120 million transactions and 368,000 smart contracts created.