State cost reduced by 5200 times, ZK Compression allows Solana to beat Ethereum?

Last week, Solana launched a new technology called "ZK Compression", which is said to reduce Solana's state cost and allow Solana to improve network scalability without going through L2. This simply slaps the words "I win" on Ethereum's face.

Solana co-founder Anatoly Yakovenko also appeared to emphasize that "all executions of this technology occur on L1 and are ordered by L1 validators." Justin Bons, founder and chief information officer of Cyber ​​Capital, believes that "this clearly puts Solana far ahead of ETH in terms of actual L1 scalability, solving one of Solana's biggest existential problems."

Is the Ethereum community "broken"?

There is a "triple dilemma" in blockchain, that is, it is difficult for distributed networks to take into account decentralization, security and scalability at the same time. On the basis of retaining the first two, in order to improve scalability, Ethereum chose to outsource its execution layer business to L2.

From the initial plasma to the current rollup, L2 has indeed solved the scalability problem of Ethereum, making Ethereum a "everything asset". But this choice also brought unexpected chaos to Ethereum. As L2 gradually fragmented, Ethereum's own value capture ability was gradually weakened. On June 29, the Ethereum mainnet gas fee even dropped to 1 Gwei.

The recent debate between Ethereum and Solana also targeted L2. It can be said that the L2 solution is a big gamble for Ethereum. However, this dilemma was solved by Solana. Ethereum believers naturally could not easily accept this reality and questioned the "L1 nature" of ZK Compression.

In Ethereum’s L2 solution, Validium’s mechanism is very similar to zkRollup. All transaction validity is enforced using zero-knowledge proofs. The main difference is that the data availability in zkRollup is on the chain. Validium, on the other hand, remains off-chain.

Because of this, when Mert Mumtaz, CEO of Solana ecological development platform Helius, said that the data of ZK Compression is kept off-chain, the Ethereum community regarded it as validium. Among them, CEHV partner Adam Cochran firmly stated that ZK Compression is Solana’s L2 solution, and he believed that “one day, the Solana crowd will realize that what they have built is a good rollup based on L2 functionality/effectiveness. rather than a whole chain."

Even though Anatoly emphasizes that “all execution occurs on L1 and is ordered by L1 validators” of the technology, Adam still insists that ZK Compression cannot be L1.

The Solana community responded with a meme, mocking Ethereum believers for claiming to be experts without doing serious research. Mert even named ZK Compression ZK validium in a pique.

Solana airdrop cost is 5200 times cheaper

ZK Compression is a blockchain scaling solution jointly launched by Solana ecological development platform Helius and Solana ecological privacy project Light Protocol. According to Helius CEO Mert Mumtazt, ZK Compression will be performed directly on L1 without the need for L2, which will greatly improve the scalability of the Solana network and "take a step towards building a financial computer - an unstoppable, global, atomic state machine synchronized at the speed of light."

According to ZK Compression documentation, this technology is a new primitive built on Solana that enables developers to build applications at scale. Developers and users can choose to compress their on-chain state, reducing state costs by orders of magnitude while maintaining the security, performance, and composability of Solana L1.

ZK Compression works through a process called state compression, allowing developers to use Solana’s cheaper ledger space instead of the more expensive account space to store certain types of data. The "hash" or "fingerprint" of the off-chain data is stored on-chain for verification using "sparse state trees".

The purely technical explanation may be too complicated. Simply put, this technology reduces Solana’s state cost.

In Solana, technicians face two costs - computing cost and state cost. Currently, Solana already has cheap computing power, but state is expensive. Allocating accounts, paying rent, and scaling with users have all proven to be huge obstacles for Solana developers, and ZK Compression solves this problem.

Mert takes the airdrop cost as an example. Assuming an airdrop is conducted to 1,000,000 users, the cost of the status is reduced from the original over 260,000 US dollars to 50 US dollars, which is 5,200 times cheaper.

In order to make the L1 nature of the technology more convincing, Mert named Ethereum founder Vitalik on Farcaster and asked him to comment on the technical principles of ZK Compression. Vitalik also responded seriously and said that the technology is more like a stateless client architecture.

Vitalik interpreted ZK Compression into 3 main points. First, you have a new account class, and for these accounts, only the hash of their status is stored on the chain; second, to interact with these accounts, you need to write a TX, which specifies the pre-state hash and post-state hash of N accounts and provides a proof of validity (assuming this means ZK-SNARK); third, the new state requires disclosure (which is reasonable, otherwise You could send a random amount of money to someone and their account would be inaccessible, you could bypass this and make it a Ut xo system, but that would be a significant limitation).

In addition to interpretation, Vitalik also raised questions about the document, on the one hand, the validity proof of the 128 bytes mentioned in the document, and on the other hand, whether the public content contains transaction content.

Subsequently, Vitalik posted again to express doubts. He believed that the number claimed by ZK Compression was like, if done individually each time, the cost of verifying SNARK would be higher than the cost of doing some small actions and hash operations (such as token transfer). The income of ZK rollup comes from "one" SNARK packaging "many" transactions.

But Vitalik’s question was not responded to, and he initially called ZK Compression a “stateless client architecture”, which made Solana’s advocates more confident and believed that the technology was L1.

Will Rollup be the perfect match for Solana?

Solana has always been looking for value for its network. The valuation logic of the copycat chains that emerged from the last bull market is not exactly like that of Bitcoin and Ethereum. Since block space is cheap, it is difficult for the corresponding currency prices to rise significantly. However, Solana is still focusing on compression technology and constantly reducing its own costs, which to a certain extent is a huge challenge to the value-added of SOL.

Even taking into account Moore's Law, even if hardware continues to improve performance, and Solana is optimized for this hardware advancement, this does not mean that Solana can cope with global demand, but Solana will rely on composability and low Latency is managed better than other chains.

Unlike Ethereum, the Solana mainnet is not intended to be a “B2B chain”; it has always been and will always be a consumer chain. Building distributed systems at scale is extremely challenging, and Solana has the greatest potential to become the shared ledger of the world’s most valuable transactions.

And for rollup, Solana rollup will be mostly abstracted for end users.

Ideologically, Ethereum’s rollup is top-down, that is, the Ethereum Foundation and leaders decide that the best way to scale is through rollup, and then start supporting various Layer2 after the CryptoKitties incident. At Solana, demand comes from the bottom up, from app developers with significant user adoption. As a result, most current roll-up plays are marketing plays, more narrative-driven than user-need-driven. This is a significant difference that could lead to a different rollup future than Ethereum.

But ZK Compression’s state compression for Solana, coupled with Firedancer, multiple concurrency leaders, asynchronous execution, and an ecosystem of thousands of developers, definitely gives Solana a real opportunity for crypto.

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