ZKsync: The Power of Zero-Knowledge Technology Scaling Ethereum

Market Position: Who Are the Players in the Layer-2 Arena?

Scaling solutions within the Ethereum ecosystem are becoming increasingly diverse. In this space, ZKsync ranks seventh among Layer-2 protocols for Ethereum in terms of total value locked (TVL). The platform, with approximately $760 million in TVL, is also the second-largest player in the zk-rollup category. It has successfully processed over 400 million transactions from more than 7 million addresses. In comparison, Base has a TVL of $7.14 billion, Blast holds $2.99 billion, and Mantle has $1.18 billion. Alternative zk-rollups like StarkNet and Polygon zkEVM are at levels of $740 million and $139 million, respectively.

ZK Token and Airdrop Event: How Did the Market React?

In June 2024, ZKsync launched its native token ZK and initiated a major airdrop campaign. 45% of the tokens to be distributed in the first week have already been claimed, demonstrating strong community interest in the platform. The ZK token is currently trading at around $0.03. While its market cap is approximately $242.47 million, its all-time high on June 17, 2024, was $0.37. In the airdrop distribution, 89% went to active users, and 11% to ecosystem contributors involved in network development, promotion, and education. A total of 695,232 wallets were eligible, based on the snapshot taken on March 24, 2024.

How Does ZKsync Work Technically?

ZKsync is a Layer-2 protocol that addresses Ethereum’s scalability issues. It processes transactions off-chain (off-chain) in batches and records them on Ethereum with a single cryptographic proof. Using zero-knowledge proofs (zero-knowledge proofs - ZKP), it verifies transaction validity without revealing details. This ensures both privacy and security.

The system consists of two main components: On-chain components, which include smart contracts on Ethereum that handle storage of rollup blocks, tracking deposits, and verifying proofs; and off-chain components, which run on virtual machines to facilitate fast transaction processing.

The transaction flow is as follows:

1. Batch Creation: Multiple transactions are bundled off-chain into a single batch. This reduces the number of individual transactions on the Ethereum mainnet, saving time and costs.

2. Proof Generation: A zero-knowledge proof (zk-proof) is generated for each batch. This proof verifies the validity of all transactions without revealing their details. The proof is compact and can be verified quickly.

3. On-chain Verification: The proof is submitted to Ethereum, where smart contracts verify its validity. If valid, the batch is recorded on-chain. This method prevents overloading Ethereum.

As a result, the system can handle up to 100,000 transactions per second, providing high scalability.

What Are the Technological Advantages?

Increased Capacity: Off-chain processing significantly boosts Ethereum’s throughput.

Lower Costs: Most transactions move to Layer-2, reducing network congestion and gas fees. Users benefit from cheaper transactions while maintaining the security of the main chain.

Strong Security: Zero-knowledge proofs (zk-SNARKs) mathematically verify transaction validity, protecting user data and transactions.

EVM Compatibility: Compatibility with the Ethereum Virtual Machine makes it easier to migrate existing Ethereum dApps to ZKsync. Developers can integrate without major changes.

Enhanced User Experience: Features like gasless meta-transactions enable users to pay fees with any token, increasing accessibility.

How to Benefit from the Airdrop

Active participants in the ZKsync ecosystem are eligible for the airdrop. Eligibility criteria include using dApps, providing liquidity, swapping tokens, and participating in community events.

Eligible wallets have received between 450 and 100,000 ZK tokens. The claim period runs from June 16, 2024, to January 3, 2025. There is no vesting period; tokens are immediately available for use.

To participate in future rewards:

• Transfer your ZK tokens through the governance system to influence ecosystem decisions
• Continue active transactions and use dApps on the ZKsync network
• Stay informed about network developments and new announcements

Asset Bridging: Step-by-Step Guide

To transfer assets to ZKsync:

1. Access the official ZKsync bridge portal
2. Connect an Ethereum-compatible wallet like MetaMask
3. Select the asset you want to bridge and specify the amount
4. Review transaction details and confirm
5. Sign the transaction in your wallet

Tips for successful bridging:

• Use reputable and well-reviewed tools
• Verify that the token you want to bridge is supported by ZKsync
• Calculate gas fees in advance
• Ensure correct token addresses
• Monitor transaction confirmations

Layer-2 Solutions Comparison: Which Is Best Where?

ZK-Rollups vs. Optimistic Rollups: Key Differences

ZK-Rollups $740M ZKsync model$700M : Validates transactions off-chain and submits a validity proof to Ethereum. Finality is quick; withdrawals can be completed within hours. However, proof generation is complex and requires high computational power.

Optimistic Rollups: Assume transactions are valid by default, with fraud proofs used during disputes. Processing is initially faster, but dispute resolution can take up to a week. Integration is simpler but more vulnerable to censorship attacks.

Choosing between them depends on project requirements: security, speed, complexity, and cost considerations.

Comparison with Other ZK Rollups

Alternatives like StarkNet and Polygon zkEVM are available. ZKsync’s advantage is EVM compatibility, making it easier to migrate existing Ethereum projects. StarkNet uses the Cairo language, which has a steeper learning curve but can handle millions of transactions.

ZKsync’s strength lies in its broad application scope, from DeFi protocols to payment systems. Each solution has unique technical features and benefits.

Challenges Faced

Technical Complexity: Developing and managing zk-rollups is difficult. Advanced cryptographic techniques require significant computational resources and expertise.

Liquidity Fragmentation: Assets distributed across Layer-2 solutions can lead to fragmented liquidity, affecting transaction efficiency and price stability.

Early Stage Development: Like many Layer-2 solutions, ZKsync is still evolving. Unforeseen challenges may arise as it scales.

EVM Compatibility Limitations: Some intermediate steps are needed for full EVM equivalence, which could cause potential compatibility issues.

Future Outlook

ZKsync will play a critical role in scaling Ethereum. By processing transactions off-chain and recording them in batches, it offers faster, cheaper transactions while maintaining security. Its adoption in projects like Mute.io, SpaceFi, and EraLend demonstrates its potential.

As Ethereum 2.0 upgrades continue, ZKsync will become increasingly important in managing higher transaction volumes and maintaining network efficiency. The integration of ZKsync rollups with Ethereum’s sharding technology promises greater scalability and lower costs, benefiting both developers and users. This synergy will accelerate Ethereum’s development and establish ZKsync as a fundamental component of blockchain technology.