The public sale of zkVerifier nodes is imminent. How does Lumoz build a modular computing layer?

Author: Peng Sun, Foresight News

Without DePIN, ZKP might be unattainable for ordinary people throughout their lives. In recent years, ZKP has been criticized for slow proof generation speeds and high verification costs. However, the emergence of DePIN has changed the way people think, making ZKP a low-threshold ecosystem that everyone can participate in. Many cryptographic companies have improved ZKP proof generation efficiency through hardware acceleration, but few have focused on another important component of the ZK proof system: the Verifier. Currently, the market has only a few ZK verification layer projects, including Cysic, Aligned Layer, and Lumoz.

Cysic has not made significant progress on the verification layer, while Lumoz is actually a modular computing layer and ZK-RaaS platform that addresses both the computational cost and centralization issues in the ZKP proof generation and verification process, providing project parties with the ability to launch chains with one click. Beyond the Prover Network, Lumoz further opens the verification layer to ordinary users, with its zkVerifier aiming to achieve decentralized verification and reduce L2 Gas costs.

Recently, Lumoz completed a strategic round of financing exceeding ten million dollars at a valuation of 300 million dollars and has begun selling zkVerifier Nodes. The pre-sale and whitelist registration activities have now ended, and the whitelist sale round (June 25) and public sale round (July 3) are about to begin, with the mainnet expected to launch in the third quarter. Today, Foresight News will interpret the Lumoz zkVerifier node sale and the operational mechanisms behind it.

Modular Computing Layer: What is Lumoz?

We have heard of modular DA layers and settlement layers, but what is a modular computing layer? Historically, modularization has divided monolithic blockchains like Ethereum into settlement layers, consensus layers, execution layers, and DA layers based on different functions. With the widespread adoption of ZKP, decentralized computing layers (proof layer + verification layer) have gradually become a major field of study.

Lumoz (formerly Opside) is a modular computing layer and ZK-RaaS platform, co-founded and led by CEO NanFeng, a graduate of Tsinghua University, with the core team investing nearly five years in the research and development of ZK technology. As a ZK-RaaS platform, Lumoz provides a modular computing layer for ZK Rollup, employing a hybrid consensus mechanism of PoS and PoW, and introducing a zkVerifier node network. Since its launch, the ZK-PoW mechanism has attracted participation from 145 miners globally, with over 20,000 verification nodes in the test network. Overall, Lumoz's modular computing layer solution allows project parties to avoid the complexities of building and operating ZKP systems, reducing the difficulty of issuing ZK-Rollups.

Currently, the Lumoz community has over a million members, with a total ecosystem TVL exceeding 4 billion dollars. Lumoz's RaaS services now support more than 20 L2 chains, including Merlin Chain, HashKey Chain, ZKFair, Ultiverse, and Matr1x.

In terms of financing, Lumoz recently completed a strategic round of financing exceeding ten million dollars at a valuation of 300 million dollars, with participation from IDG Blockchain, OKX Ventures, HashKey Capital, Polygon, NGC Ventures, Kronos, KuCoin Ventures, Gate Ventures, G Ventures, MH Ventures, Summer Ventures, and Aegis Ventures. In April 2024, Lumoz completed a 6 million dollar Pre-A round financing at a valuation of 120 million dollars. In April 2023, Lumoz (formerly Opside) completed a 4 million dollar seed round financing.

zkVerifier: How Does Lumoz Reduce Gas Fees for Users?

So, what exactly is the zkVerifier that Lumoz is selling? What is its purpose? What problems does it aim to solve? Let's start with the ZK proof system.

ZK Proof System: Prover and Verifier

In fact, the so-called zkVerifier is the Verifier in the ZK proof system. In the ZK proof system, proof generation and verification consist of Prover and Verifier. After completing the "arithmetic" on the frontend, both parties are responsible for generating and verifying ZKP proofs to demonstrate the authenticity and reliability of data without revealing the actual data. Projects like Cysic and Ingoyama are providing computational power to Provers through hardware to speed up the proof generation process. The generated ZK proofs need to be verified by the Verifier for data authenticity.

Bing Ventures has analyzed the cost structure of ZKP, pointing out that the cost advantages of ZKP are an exaggerated illusion. In reality, ZKP includes hardware costs, computational costs, verification costs, storage costs, etc. Among these, communication costs and computational costs are the core components. Communication costs refer to the costs of exchanging information between the prover and the verifier, while computational costs refer to the costs incurred by the prover and verifier in executing computations. In Ethereum, verification computations compete for block space with other DApps, and network congestion can lead to higher costs. Matter Labs has pointed out that zk-Rollups on Ethereum require about 600,000 Gas to verify a zk-SNARK, while zk-STARK requires about 2.5 million Gas.

More importantly, the verification costs of ZKP are directly borne by users. Data from L2BEAT indicates that the cost of Ethereum L2 was primarily storage (blue) before the Cancun upgrade, and after using Blobs, it became primarily computation (red).

After the Cancun upgrade, the computational costs of ZK Rollup average around 80% of the total costs.

Therefore, in addition to improving ZK proof generation efficiency, it is also necessary to enhance verification efficiency and reduce Gas costs. Currently, most ZK-Rollup projects have not made optimizations or improvements in the verification layer.

Lumoz Architecture and Operational Mechanism

Lumoz is a pioneer in the decentralized verification layer for ZKP. It is essentially an AVS computing layer based on EigenLayer shared security, with a basic architecture that includes EigenLayer AVS, EVM chains, Lumoz AVS oracle, Lumoz Chain, zkProver, and zkVerifier. The responsibilities of each component are as follows:

• Lumoz builds AVS using EigenLayer standards, re-staking through Ethereum to share the economic security of the Ethereum mainnet;
• EVM Chain: Lumoz supports EVM chains such as Polygon zkEVM, Polygon CDK, ZKStack, and Scroll;
• Lumoz AVS Oracle: Responsible for retrieving and storing data from EVM-compatible chains, ensuring high availability and integrity of the data;
• Lumoz Chain: The core management layer of the computing layer, responsible for task scheduling, reward distribution, and managing zkProver and zkVerifier, including but not limited to the addition and removal processes of nodes;
• zkProver: Nodes that execute specific computational tasks;
• zkVerifier: Verification nodes that validate execution results.

In terms of the specific operational mechanism, Lumoz adopts a ZK-PoW mechanism and a two-step submission algorithm of "submit first, verify later." The zkProver network, composed of miners, provides computational power for ZK-Rollups to execute multiple ZKP generation tasks in parallel. The ZK-PoW V2.0 version further optimizes the proof generation computational process, significantly improving generation efficiency and addressing the centralization issues of Provers. Lumoz does not stop there; it further extends from the proof generation layer to the verification layer, introducing zkVerifier to verify the ZKP generated by zkProver.

In other words, Lumoz has built a decentralized verification network for Verifiers, where zkVerifier nodes aggregate, compute, and verify data, covering various fields such as blockchain transaction data and AI model training data, ensuring the accuracy of data and correctness of the computation process. By uploading both the verification results and computation results to the blockchain, zkVerifier nodes not only ensure the transparency and traceability of the entire computation process but also reduce verification costs.

Due to the relatively low hardware configuration requirements for zkVerifier nodes, ordinary users can join the Lumoz network and participate in the operation of verification nodes using a lightweight client. Currently, Lumoz has completed early verification, with over 20,000 verification nodes in the test network, and large-scale low-cost verification is being realized. In other words, as the participation threshold is lowered, more users are joining Lumoz's ZK computing network, making ZKP Verifier verification more decentralized and reducing the verification costs paid by users.

At the same time, zkVerifier nodes have long-term sustainability. Beyond ZKP computational tasks, users can also provide computational verification services for massive AI data.

zkVerifier Node Sales and Revenue

Currently, most projects selling nodes on the market are primarily focused on selling nodes for the sake of selling, but these nodes have long payback periods and low actual value. However, Lumoz's zkVerifier is an essential component of the ZK Endgame, indispensable for the blockchain industry and users. In Lumoz's tokenomics, the total supply of MOZ is 10 billion tokens, of which 25% will be allocated to zkVerifier nodes, with expected returns and rates of return being quite substantial.

Node Sales

Let's first look at the node sales situation. Lumoz launched the zkVerifier node NFT sale on June 17, with a cap of 100,000, divided into 10 tiers, on a first-come, first-served basis. This node sale is divided into three rounds: pre-sale round (June 17, 15:00), whitelist round (June 25, 15:00), and public sale round (July 3, 15:00), with a starting sale price of 200 USDT.

The pre-sale round was only open to users holding pre-sale invitation codes, offering the greatest returns, and has now ended, with Tier 1-4 sold out, successfully selling 40,151 nodes, with a real-time FDV exceeding 40 million dollars. Users who wish to continue participating in Lumoz nodes can purchase Tier 5 and above nodes starting at 15:00 on June 25 during the whitelist round. Users with a whitelist can enjoy a 10% price discount. If they did not participate in the pre-sale round (June 17) and missed the whitelist qualification, they can participate in the public sale round (July 3).

The node NFT license supports free buying, selling, and transfer. When a zkVerifier node transfers its held license to another party, that node will no longer be eligible to receive any form of rewards from the Lumoz network.

Lumoz has also set up a refund mechanism, with the refund window opening six months after the TGE, lasting for an indefinite period. If users are dissatisfied with the nodes, they can apply for a no-reason refund, and Lumoz will refund 80% of the initial payment amount, at which time users must return all produced tokens and node NFTs.

Additionally, to incentivize more users to participate in the node network, Lumoz has launched an invitation incentive program. If an invitee purchases a node NFT, the inviter will receive 7% of the amount paid. If the invitee further invites others to purchase nodes, the inviter will receive 3% of the amount paid by those invitees.

Pre-TGE: Points Airdrop

Before the mainnet launch, Lumoz will provide a reward of 40 million points for zkVerifier node NFT holders. Over 40 days from June 25 to August 4, 1 million points will be distributed daily. These points will be evenly distributed to users who hold and stake zkVerifier node licenses, and after the TGE, users can exchange these points for Lumoz mainnet tokens.

For node license staking, Lumoz has additionally launched a "team system," where node holders can choose a team or create their own team, with a maximum of 50 people per team. Team levels include Black Iron, Bronze, Silver, Gold, Platinum, and Diamond. The more licenses staked by a team, the higher the level and the greater the weight of points.

Post-TGE: Mining Rewards and Payback Period

The MOZ rewards for nodes will be fully released over 36 months, with tokens released once per Epoch (approximately 1-2 minutes), distributed based on the number of nodes online during that Epoch and their staking status. As seen in the chart below, the more nodes online simultaneously, the less monthly reward is released. For example, if 10,000 nodes are online simultaneously, the first month's reward per node would be 6,944 MOZ. Considering that 40,000 nodes have already been sold in the pre-sale round, with the future mainnet launch, the number of nodes online will also increase, leading to a decrease in monthly MOZ rewards per node.

Regarding expected return rates and payback periods, conservatively calculating based on the current latest valuation of 300 million dollars, assuming 10,000 nodes are online in the first month, running a node for a month would yield 208 dollars. If purchasing a Tier 1 node, the payback period would be one month, with a six-month return of 4,374 dollars, resulting in a net return rate exceeding 20 times. If a user purchases a Tier 5 node during the whitelist round, the cost would be 350 dollars, with a payback period of one and a half months and a six-month return exceeding 12 times. If 50,000 nodes are online simultaneously, purchasing a Tier 1 node would result in a payback period of two and a half months, with a six-month return of 4.3 times; if purchasing a Tier 5 node, the payback period would be four months, with a six-month return of nearly 2.5 times.

Recently, the Aethir node sale was extremely successful, with a market value of about 3 billion dollars. Using Aethir as a comparison, the price of an Aethir Tier 1 node is 500 dollars, currently yielding 31.44 ATH daily. At the current price of 0.07 dollars, the monthly yield would be 66 dollars, meaning it would take 7.5 months to break even. Overall, even with a valuation of 300 million dollars, Lumoz nodes have a noticeably shorter payback period and higher returns.

Additionally, since Lumoz is also a RaaS platform, future nodes may also receive potential token airdrops from new Lumoz ecosystem chains such as Merlin Network, ZKFair Network, and Orange Network, among other rewards.

Node Operation Requirements

As mentioned earlier, zkVerifier nodes have relatively low hardware configuration requirements, capable of running on devices with 4 or more CPU cores, 8GB RAM, and 16 Mbit/s bandwidth. Users can bind their licenses to run nodes for mining or delegate their NFTs to other nodes for mining.

References:

• 1. Kyle Liu: "Is the Low Cost of ZKP a Myth?," Bing Ventures, Dec 25, 2023;
• 2. ZeY: "Lumoz Research Report: Modular Chain Launch, Greatly Reducing ZKP Computational Costs," SevenUp DAO, June 18, 2024;
• 3. Peng Sun: "When ZKP Meets DePIN, How Does Cysic Bring PoW Back to Ethereum?" Foresight News, April 26, 2024.