Comparison of zkRollup solutions Matter Labs and Starkware: Differences in testnet products and roadmaps

Original source: bankless

Author: Alex Beckett

Don't believe the FUD, Ethereum is scaling.

A few weeks ago, David wrote an article titled "Ultra Scalable Ethereum."

In it, he explained why Ethereum is transitioning from a monolithic design (where consensus, execution, and data availability all happen in one place) to a modular design to partition and optimize these functions.

Image: CPUs and GPUs have undergone the same transition from monolithic to modular design to significantly improve scalability.

Today, we will delve into the execution layer, which is where most of us participate in DeFi today, but tomorrow, the execution layer will be rollup.

As you learn more about rollups, you will begin to realize that not all rollups are the same.

So far, two types of rollups stand out: zkRollups and optimistic rollups.

Today, we will focus on zkRollups ------ a rollup design that uses zero-knowledge cryptographic proofs to validate transactions.

We won't discuss technical details but will compare the two heavily VC-funded zkRollup solutions: Matter Labs and Starkware.

Zero-knowledge cryptography is cutting-edge, and general zkRollups are considered the holy grail of Ethereum scaling.

So when can we expect zkRollups to arrive?

Alex Beckett introduces us to the two best zkRollup projects today.

zkRollups: Comparing Matter Labs and Starkware

For a long time, Ethereum has faced challenges in implementing scaling solutions, and after years of research and development, the Ethereum developer community has shifted to a rollup-centric roadmap.

But not all rollups are the same, and today, we will focus on zkRollups.

The two leading teams competing in the zkRollup space are Matter Labs and Starkware. Matter Labs has zkSync 1.0 and zkSync 2.0, while StarkWare has StarkEx and StarkNet.

Let's dive into these projects, but first, let's quickly understand what a rollup is.

Background on Rollups

Rollup is a scaling solution that bundles transactions together, compresses them, and sends them to the consensus layer for validation. This improves efficiency by validating multiple transactions at once while scaling by increasing the number of transactions that can be executed.

Suddenly, Ethereum can scale its TPS from 15 to 3000+ without sacrificing security.

In particular, compared to optimistic rollups, zkRollups can integrate privacy into rollups using zero-knowledge proof technology. Zero-knowledge achieves privacy by allowing one party to prove something to another without disclosing the information needed to prove it. However, not all zkRollups leverage the privacy properties of zero-knowledge proof technology.

Moreover, more users conducting zkRollup transactions will lower the cost of using the network, which is the opposite of typical blockchains, where usage fees tend to become more expensive as network usage increases.

This new innovative dynamic between rollups and Ethereum is referred to as "modular blockchain."

zkRollups Deployed on Ethereum Mainnet

StarkEx is the zkRollup launched by StarkWare in June 2020, supporting general smart contracts (where "general" refers to the ability of smart contracts to run arbitrary logic). Applications can be deployed on StarkEx, leveraging the scalability of zkRollups while providing a user experience similar to or even better than Ethereum.

So far, StarkEx has processed 42 million transactions and $185 billion in cumulative transaction volume through its four hosted protocols (dYdX, ImmutableX, DeversiFi, and Sorare).

Because rollups are deployed on Ethereum, they are subject to Ethereum's limitations. Therefore, StarkEx launched a new system called validium, providing a cheaper option for applications and users.

The mechanism of Validium is very similar to zkRollups, with the only difference being that data availability in zkRollups is on-chain, while Validium keeps it off-chain. This allows Validium to achieve higher throughput.

• Alex Gluchowski

Validium transaction fees are very low, and in practice, they have been abstracted away by the protocols on StarkEx. ImmutableX is one such example, where the gas fees for minting and trading NFTs are $0, while Ethereum's NFT transaction fees range from $20 to $250. DeversiFi also offers $0 gas fees, allowing it to follow a fee structure similar to centralized exchanges.

StarkEx also features SHARP, a service that allows batch transactions from multiple applications to be aggregated into a single transaction and immediately published to Ethereum. It currently operates with DeversiFi and Sorare, enabling them to further reduce operational costs for users.

zkSync

zkSync is a zkRollup layer-2 network built by Matter Labs, designed for scalable payments. Users can deposit funds into this network and interact with other zkSync accounts for transfers, with costs being just a fraction of Ethereum's mainnet. Since the mainnet launch in June 2020, zkSync has processed 4 million transactions, with transfer fees as low as $0.20.

User transactions can be paid with any supported tokens (such as ETH, DAI, RAI) as well as the tokens being transferred, without needing to hold a specific fee token. As of now, the total TVL of all deposits in zkSync is $24 million.

The peak load encountered by the zkSync network so far was during the Gitcoin grant period, with about 20,000 transactions per hour (TPS 5.6). Although this is much lower than the 18,000 transfers demonstrated by StarkEx, it lasted for a full hour.

In July of this year, zkSync also added NFT functionality, allowing users to mint, swap, and transfer NFTs.

While zkRollups do not require a withdrawal waiting period like optimistic rollups, zkRollups do have to wait for block filling before sending to L1. In practice, this means that if the number of transactions is low, withdrawals may have to wait for several hours.

Comparative Testing of Products

StarkNet

StarkNet is StarkWare's next iteration of zkRollup, and they plan to launch the StarkNet alpha mainnet this month. This could make it the first zkRollup to offer general smart contracts on a fully composable network, a feat believed to take years to achieve.

Composability refers to the ability of applications to coordinate, build upon, and interconnect with each other. So far, zkRollups like StarkEx, which have smart contract capabilities, do not possess the ability to make applications composable.

The StarkNet testnet has enabled general smart contracts since June and composability since August. Application deployment is permissionless, allowing anyone to write smart contracts and publish them on the testnet using the native programming language Cairo. StarkWare has provided a simple DEX in collaboration with dOrg to demonstrate StarkNet's capabilities.

To provide a development experience similar to Ethereum, the Warp team has demonstrated the ability to compile Ethereum EVM code into StarkNet contracts.

zkSync 2.0

zkSync 2.0 is the next version of the initial zkSync network, aimed at achieving fully composable smart contracts on zkRollups. The zkSync 2.0 testnet launched in October, with Curve Finance being the initial test application.

zkSync 2.0 also introduces the zkEVM testnet, a virtual machine that simulates the Ethereum environment, allowing Ethereum smart contracts to be deployed on zkRollups. The project has reportedly demonstrated the zkEVM testnet's capabilities through UniSync (a fork of Uniswap V2).

Since its launch in October, UniSync has processed 590,000 transactions on its testnet. Nevertheless, all zkSync testnets are currently in closed testing, allowing only whitelisted applications to deploy.

Roadmap Comparison

Roadmaps are crucial for determining future goals and simplifying complex journeys. Both StarkNet and zkSync 2.0 have roadmap visions that display their objectives, both moving towards a final goal of security, stability, and complete decentralization.

StarkNet

The StarkNet roadmap consists of four steps:

Step 0 -- Foundation ✅

Step 1 -- Planet: Single application rollup ✅

Step 2 -- Constellation: Multi-application rollup

Step 3 -- Universe: Decentralized rollup

The initial steps lay the foundation for StarkNet's construction, including the Cairo programming language and SHARP, which allow developers to build smart contracts using a language optimized for zkRollups while sharing costs.

Step 2 is the current phase StarkWare is building, which will be completed with the November launch of the StarkNet mainnet ------ marking the release of StarkNet as a fully composable zkRollup supporting general smart contracts.

The final step is StarkNet's transition to a fully decentralized, permissionless rollup. This will not be completed simultaneously with the initial mainnet launch, as the system will still be in alpha testing to ensure that any vulnerabilities can be mitigated without compromising the system. In the initial mainnet launch, StarkNet will operate a single sequencer and permit-based smart contract deployment. Once StarkWare deems StarkNet's security sufficient, it will complete decentralization.

zkSync

The first phase of the zkSync roadmap began with the deployment of zkSync ------ a zkRollup focused on scalable payments.

Phase 2 plans to develop composable smart contracts on a new network called zkSync 2.0, which is expected to launch on the mainnet sometime in the coming months. Meanwhile, a new programming language, Zinc, will serve as the native language for smart contracts.

zkSync 2.0 will also introduce zkPorter, a PoS chain that allows zkSync 2.0 users to publish transaction data on zkPorter instead of Ethereum, achieving higher transaction throughput. Since zkPorter transactions are not subject to Ethereum transaction fees, it is expected to become a cheaper alternative.

Phase 3 will introduce privacy, unlocking another significant feature of zkRollups. This will be completed when zk proofs do not add significant overhead to the system. The final phase involves transforming zkSync 2.0 into an anti-censorship system ------ requiring the system to be decentralized and becoming permissionless by removing the Matter Labs team's complete control over the network.

Conclusion

Both StarkWare and Matter Labs offer networks with cutting-edge technology in the form of zkRollups, pushing the boundaries of blockchain scaling, privacy, and efficient cryptography.

For the networks you can use now, StarkEx has four applications, with DyDx and DiversiFi for trading, and ImmutableX and Sorare for NFTs. zkSync is suitable for simple transfers and NFT transactions.

In contrast, with metrics like $185 billion in cumulative transaction volume and 9000 TPS of verifiable transaction capacity, StarkEx has proven itself to be the most widely used zkRollup, with data over 10 times that of zkSync, Optimism, and Arbitrum. With the launch of StarkNet this month, StarkWare will also introduce a fully composable general smart contract zkRollup, which many believe is still years away from realization.

Finally, keep an eye on the mainnet versions of StarkNet and zkSync 2.0, as they represent the future of blockchain scaling as we know it.