Explain the development status of zkSync in detail: the surge of data on the chain depends on the wool party or the fundamentals?

Original Author: Joyce

The mainnet of zkSync Era was opened to everyone on March 24. In just over two months, the TVL reached 480 million US dollars, with a weekly growth rate of nearly 20%. At present, the number of independent addresses of zkSync Era has reached ;92; million, far exceeding popular Layer; 2 networks such as Arbitrum, Optimism and Starknet.

Layer;2 project TVL ranking, currently zkSync Era ranks third, second only to Optimism, data source: L2beat

Although these dazzling data are not unrelated to zkSync Era's "Token" distribution expectations, in any case, after the popularity of Bitcoin ecology led by BRC-20 fades, zkSync Era has become a rare hot spot and topic successor in the market .

So what is the current ecological development of zkSync Era? What is the usability of ZK Rollup, which has always been criticized for its technical difficulty and slow progress? After the expected end of Token incentives, can zkSync Era continue to maintain high popularity and high; TVL; growth?

1. Layer; 2; The flames of war spread, what are the advantages of zkSync Era;

The high fee, low speed and even congestion of the Ethereum mainnet have brought about the explosion of the Layer;2 sector. Especially in the past six months, Arbitrum, Optimism, etc. have successively released token airdrops, and a large number of stories of getting rich because of this have attracted the wool party to turn their attention to Layer;2 projects that have not yet released tokens. Binance, Coinbase, ConsenSys, etc. have successively entered the Layer;2 sector, and the blessing of giant funds has made Layer;2 a highly anticipated encryption narrative.

So, what is the position of zkSync Era among all Layer;2, and what are its advantages?

At present, the Layer;2 that the industry focuses on is mainly the Rollup solution, including Optimistic Rollup and ZK Rollup. The basic principle of both is to package some transactions in Layer;2 and submit them to the Ethereum main chain. The difference is in the form of data validation.

Optimism Rollup first assumes that all transaction data is ok, but provides a period of inspection gap. Once someone finds transaction data involving fraud, they will be rewarded with penalty funds pledged by audit nodes.

ZK Rollup adopts the method of zero-knowledge proof. After the data is packaged, the zero-knowledge proof of the data is generated through a large number of calculations and other relevant core data are submitted to the chain to verify whether there is an error. Compared with the tortuous game process in the middle of Optimism Rollup, the result of sex is indeed much better.

However, the problem with ZK Rollup is that the technical implementation is much more complicated than that of Optimism Rollup. Therefore, when the main network of Optimistic Rollup projects such as Arbitrum and OP goes online early to seize the opportunity, other ZK projects can only do it in a hurry. After all, technically The difficult problems require real investment of time and resources, and there is no rush.

However, whether it is a public chain or a Layer;2 project, ecological construction is particularly important. Moreover, the construction of many projects is the process of maintenance while flying the plane. It is difficult to wait for a project to be perfect before going online. Bitcoin is an exception. After all, the functions and incentive mechanisms of Bitcoin are very simple.

For most projects, it is a process of running and iterating after going online, and Ethereum is a typical example. Today's Ethereum, compared with when it was first launched, has undergone great changes in terms of performance, architecture, and even the consensus mechanism. However, the continuous construction of the ecology has made Ethereum a giant in the industry.

Therefore, it is not difficult to understand that some public chain or "Layer; 2" projects are eager to go online before the technical solution is fully mature.

Judging from the current "Layer; 2" entire ecological pattern, since Arbitrum's mainnet launch in September; 2021, TVL; has soared to more than one billion US dollars in just a few days. Arbitrum is still a month early, but when it went online, the stability and experience of the mainnet were not as good as expected, and the TVL growth was not as good; Arbitrum was rapid. But in any case, compared with ZK projects such as zkSync and Starknet, which launched the main network a year later, they have indeed seized the opportunity in ecological construction.

However, as the first ZK Rollup to be launched on the mainnet, zkSync Era; the data after its launch is also remarkable.

Unlike Starknet, which uses an independent contract language, the language tools used by zkSync Era are very compatible with the existing Ethereum mainnet. Such high compatibility allows projects on the Ethereum mainnet to migrate to the zkSync Era mainnet quite smoothly, and Like Arbitrum in the early days, the TVL of zkSync Era rose rapidly after the mainnet launch, exceeding the TVL of 2 billion US dollars in just 20 days, which is not inferior to the current state of Arbitrum's initial launch.

Therefore, although the current TVL of zkSync Era accounts for less than 5% of the entire Layer; 2, with the current weekly growth rate of nearly 20%, is it possible to expect the future?

2. zkSync ecological overview

Arbitrum currently has a TVL of 5.6 billion US dollars, accounting for about 65% of the TVL of all Layer;2 projects. After a year and a half of ecological construction, there are currently more than 500 DApps on Arbitrum, especially GMX, which once continued to dominate the list of hot spots in the bear market. (2021; Year; September; Launched on; Arbitrum;), it is the flagship project of Arbitrum's ecological native.

It can be said that the rise of Arbitrum; is inseparable from these original high-quality projects. Even after the Token distribution incentives have been completed, Arbitrum TVL; still ranks first. Although at the beginning, due to its high compatibility with the Ethereum mainnet; EVM; a large number of DApps on Ethereum can migrate smoothly and complete the accumulation of initial TVL, but the real continuous competitive advantage depends on its native high-quality DApps.

So, how is the current zkSync ecology? Are there signs of strong projects like GMX appearing?

According to the current zkSync official website statistics, nearly 300 Dapps have been connected to the zkSync Era ecosystem. Although there are many star projects such as Uniswap, 1inch, and LayerZero among them, only the projects marked "Live on Era" are actually launched. Only;58; Moreover, from the list of projects that have been launched, it is basically difficult to see well-known "DApp" figures.

Source: zkSync; official website

It can be said that the current entire zkSync ecology is still in a relatively barren state. Although the TVL has grown rapidly, the total amount is not high. SyncSwap, which ranks first, occupies more than 41% of the TVL of DeFi on the entire chain, and the top ten DApp TVL accounts for nearly 96%. Moreover, these DApps are mainly Dex, plus several lending agreements. At present, there is no project in the top ten projects that has some unique innovative advantages like "GMX".

Data source: defillama

Moreover, although the number of independent addresses of zkSync Era has grown very rapidly, it reached 920,700 in just two months, and the number of ETH on the cross-chain bridge has also broken through new highs, exceeding 280,000, but from each address In terms of the ;ETH; balance, more than 61.4% of the address balances are below 0.1;ETH, ;30.6% of the address balances are between 0.1;~;1;ETH, ;7.7% of the address balances are 1;~; 10; ETH, the remaining 0.3% of the address balance is above 10; ETH.

From the balance distribution of zkSync Era independent addresses, it is not difficult to see that the vast majority of users are wool party members who are attracted by the expectation of zkSync Era Token distribution.

zkSync, Arbitrum; and other popular; Layer; 2; project independent address and other data, source: Dune

zkSync Era; schematic diagram of address balance distribution, source: Dune

Deyi is a member of the "zkSync Era" wool army. When talking about zkSync, he said:

At present, due to the lack of star projects such as Uniswap and AAVE on zkSync Era, it is difficult to undertake the lock-up of large amounts of funds (participation; DEX; liquidity mining or loan agreement), and most of them are wool users. In particular, "zkSync" made it clear that it would issue a "token" under the "Arbitrum" innovative "token" incentive model. The expectation of "zkSync airdrop" has brought a large number of studios to flood in, bringing about an explosion in the number of independent addresses. increase.

However, the projects that are really worth participating in the interaction are also limited. They are nothing more than DEX, borrowing, and several commonly used cross-chain bridges with relatively high TVL rankings. As for zkSync’s official cross-chain bridge, because it can only cross-chain from the Ethereum mainnet to zkSync at present, the cost is 5-6; U, and even reaches 10; Airdrop is expected to interact, and other cross-chain bridges are generally used when funds are really needed to cross-chain. After all, the cost savings are more than 70%.

Three, zkSync Era; the current problem

As the first ZKEVM project to be launched on the mainnet, zkSync Era has achieved more than 920,000 independent addresses in just two months, surpassing all other mainstream Layer;2 projects, and TVL has also achieved explosive growth , but compared with Arbitrum and other star Layer;2 projects, its problems are also very obvious:

1. It is still in the early stage. Although the official website announces many cooperation projects, the star projects have not really launched. The number of native projects that have been launched is not large, and the quality is also uneven. It is difficult to rely on star projects that are endorsed by institutions and have a large community base to quickly accumulate TVL.

2. Dex and borrowing are the top-ranked native projects that have been launched. There are no projects with unique competitive advantages like GMX to break through. For users, apart from the attractiveness of Token distribution, there is not much For other reasons that must be used, after the Token distribution is expected to disappear, how to compete with the Layer 2 giants Arbitrum and Optimism, which occupy the first-mover advantage, to obtain high-quality TVL is a problem that has to be considered.

3. zkSync Era; the complexity of the technology leads to the instability of its block generation. Compared with Optimistic Rollup projects such as Arbitrum and Optimism, the ZK Rollup project is much more difficult in terms of technical development. zkSync is relatively compatible with the Ethereum mainnet, but there are still some compatibility challenges for DApps on zkSync Era. However, with the further maturity of ZKEVM technology and the arrival of the decentralization stage in the future, these problems will be effectively improved.

4. Summary

In addition to the traditional star Layer;2 projects, Binance, Coinbase, ConsenSys and other giants have laid out the Layer;2 sector, which is likely to be the light of the next round of bull market. Can zkSync Era come out? There are still too many variables.