The scalability of the Ethereum network has been a point of contention in the crypto ecosystem for many years, largely due to high fees and network congestion at a time of increased transaction demand.

A widely used solution to Ethereum’s scalability problems is zero-knowledge rollup (ZK rollup), a form of scaling that performs out-of-chain calculations and sends them to the chain through valid evidence.

Earlier this year, protocols opting for bullish roll-up solutions like Optimism and Arbitrum became increasingly popular and touted as the best solution for scaling up on Ethereum, but aside from Arbitrum, the hype surrounding exchanges awareness has subsided and traders have Be advised, even optimistic roll-up solutions have higher-than-expected fees as network demand increases.

First success in 2021

At the same time, optimistic roll-up solutions are gaining attention, and ZK roll-up protocols have quietly demonstrated their capabilities.

dYdX, a decentralized futures and margin exchange, was one of the first users of the ZK rollup technology through a partnership with StarkWare, a decentralized ZK rollup without permission.

The platform has been very successful so far and has even processed a 24-hour trading volume above that of the largest US exchange Coinbase.

Loopring (LRC) is another protocol that ZK Rollup has used to lower transaction costs and accelerate its throughput capabilities, which helped lift the LRC price to an all-time high (ATH) of $ 3.83 in early November .

1 day frame LRC price chart | Source: TradingView

ZK rollup could be the next “cycle” for dealers

After a dramatic market-wide sell-off last week, ZK Rollup is back as a buzzword in the cryptosphere.

Polygon, a Layer 2 platform for the Ethereum network, made headlines by announcing the acquisition of Mir Protocol, which is developing two subcategories of ZK Rollup, PLONK and Halo.

“Polygon’s MATIC 250 million investment in Mir is being made to discover and promote all of the scaling methods and technologies that make sense at this stage,” said Sandeep Nailwal, co-founder of Polygon.

Another highly anticipated protocol recently is zkSync, a scaling solution from Matter Labs that raised $ 50 million in a Series B round led by Andreessen Horowitz in November.

Total deposit vs. total number of individual users on zkSync

According to Digital Delphi, the two main projects working on zkSync are ZigZag, a decentralized exchange (DEX), and the Gitcoin fundraising platform.

“Follow L2 fees Token swap through ZigZag on zkSync has the lowest fee, only $ 0.65, ”said analysts at Delphi Digital.

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