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So, thank you for introduction and thank you so much for coming here.

A lot of you might be very familiar with the topic about rollups and how Rollup works, how different types of Rollup works.

But for those of you who are not, I'm going to explain how Rollups work and what are different kind of Rollups.

So just a brief introduction about myself.

I work at Quicknode as a senior developer advocate.

And I work on creating a lot of educational content.

It's blog posts, documentation, and all that kind of stuff.

So for those of you who doesn't know what Quicknode is, Quicknode is a web 3.0 development platform.

And we provide a lot of different, different tools to make lives of developers easier.

So basically, what's Ethereum's vision is to create a blockchain which everyone can use without any hurdles.

But since its inception, it has been the number 1 blockchain network and everyone has been using it for basically everything.

So because of that, the space or the block space of Ethereum has become really expensive and the gas fees have skyrocketed.

Because of all of this, the transactions are queuing up a lot and the total finality time of transactions, a lot of times, as if they are sent with less gas.

So this all relates to a concept called blockchain trilemma where each edge is a feature, you can say, for blockchain.

It's scalability, decentralization, and security.

So right now, Ethereum is very much decentralized and secure, but it has been having scaling issues for a really long time.

So the blockchain dilemma states that at any given point of time, a blockchain network can achieve only 2 of this.

So it can be either on the edge A, B, or C.

But an ideal blockchain would look like where it can stand right in the middle, where it's enough decentralized, it's enough secure because it's fairly decentralized, and then it's scalable as well.

So an ideal blockchain would look like that, but since it's not ideal at the moment, so there are some scaling solutions which have been discussed in the past and which are already in the works and which are already working right now.

So layer 2 scaling is basically scaling Ethereum off-chain by not scaling the actual Ethereum chain, but by settling transaction of the chain and 2 types of layer 2 solutions rollups and state channels.

So basically what rollups does is they set the transactions of the chain usually on a different chain and then they roll up the transaction information in a batch on the main Ethereum chain, usually using a smart contract.

And what state channels are, state channels does the same thing.

They settle the transactions of the chain but they do not send the entire transaction information as a batch on the chain but what they do is they open a state channel of the chain which is usually a multi-sig smart contract and only 2 transactions are used for the main Ethereum network.

The 1 is to open the channel, the other is to close the channel.

In the state channel, there are multiple parties who agrees on a transaction, because it's a multi-sig contract, who agrees on a transaction, and then the transaction is completed.

So state channels cannot be used practically because they are highly application specific.

For example, there are payment state channels right now where if someone wants to send a transaction in forms of tokens, what they do is they will open a monthly contract and when both the parties who are predetermined will sign the transaction and then and then only that funds will move out of that wallet.

So rollups is very like I would say practical at this moment so there has been a lot of development around rollups and basically rollups are of 2 types.

Optimistic rollups can be considered as kind of an angels of the blockchain where they consider that, or they consider every transaction which is being verified is valid and there is no fault in that.

So in Optimistic Rollups there is a batch maker or a batch submitter.

What they do is they submit the transactions which has been happening on the sidechain or layer 2 chain and this create a batch of those transactions and submit the information batch on the main Ethereum chain and now you may ask that okay so if what if there is a fraudulent transaction in that so because to encounter that there is a third party called Fraud Proof Submitter.

What they do is they identify the transaction which can be considered a fraudulent transaction, and then they submit a fraud proof.

So both of these parties who are submitting the transaction batch and fraud proof, they stake their coins.

And if any of the party is found guilty, their coins or ETH are slashed.

So once the fraud proof is submitted, that particular transaction is reran on the main Ethereum chain and if the transaction is found guilty or fraud then the fraud proof is approved and Bad submitter gets the eat slashed So this is how optimistic roll-up works and easy to implement because they don't require a really complex cryptographic framework beforehand, because they only need fraud-proof submitters and bad submitters.

And then next type of rollups technology is 0 knowledge proof rollups.

So what 0 knowledge proof does is it overcomes the assumption of a transaction being valid, but they actually validate the transaction using 0 knowledge proofs.

0 knowledge proofs are nothing but your cryptographic proofs which are generated and which validates a particular transaction without revealing much information about the transaction to other third parties.

And in 0 knowledge proof, the transactions are validated beforehand and then they are submitted on the main Ethereum chain.

So because they require a complex cryptographical framework beforehand, That's why they are kind of complex to implement.

And it has become really difficult for anyone to make a zero-knowledge-proof Ethereum compatible.

But now we are seeing a lot of different players coming in and making zero-knowledge proof compatible Ethereum chains like Polygon ZKVM.

And then there are a few challenges as well.

Implementing layer 2 chains or layer 2 technologies, the first and most centralization.

So, because these chains are very scalable and they submit their transaction information on Ethereum, that part is fine, but how transactions are verified and validated on these layer 2 chains is with the help of a sequencer.

So this sequencer is just 1 centralized entity, and if this particular entity gets manipulated, or if this particular entity gets bought down, the entire state chain can be compromised and be halt.

And then, as we saw with ZK Proof Z or ZK Proof Knowledge Proofs rollups, it's pretty complex to implement, so complexity is also a constraint, And migration is another constraint because these are different chains.

So the funds need to be migrated from 1 chain to another.

And We all know that we have to use bridges for that, and the experience to use bridges is not that good, and they can get compromised a lot of times.

And then the other point is interpolability.

So the interpolability means interpolability of the data between 1 chain to another.

So these chains have really good interpolability between that particular chain and Ethereum, but the interpolability between 1 L2 to another L2 is not that great, and all of this results to a bad user experience for an end user.

So, that's what the challenges to implement layer 2 solutions looks like.

And this was a really short presentation for everyone who did not know what layer 2s are.

And the implementations, or the best implementations for the optimistic rollups, according to me, are Arbitrum and Optimism.

They have been doing a really great job at implementing layer 2s using optimistic rollups and using ZK, Polygon ZK AVM recently came up and it's completely or fully Ethereum compatible so all the smart contracts which we have on Ethereum can be run on that particular chain as well without or with less anomalies.

And then ZK-Sync is working on their Ethereum-compatible chain as well, which is ZK-Sync-era.

So Yeah, this was it from my presentation.

If anyone has any questions, now will be the time to ask.

If you all want to connect with me, I am sensile on Twitter.

If you're a new hacker and want to check out new materials or new tutorials, we have a YouTube channel where we post regular content every week to help people build different kind of applications.


Speaker 0: So, thank you for introduction and thank you so much for coming here. So today I'm going to talk about a

Speaker 1: really well-known topic of layer 2s. A lot of you might be very familiar with the topic about rollups and how Rollup works, how different types of Rollup works. But for those of you who are not, I'm going to explain how Rollups work and what are different kind of Rollups. So just a brief introduction about myself. Hi, I'm Sail Sen.

I work at Quicknode as a senior developer advocate. And I work on creating a lot of educational content. It's around videos. It's blog posts, documentation, and all that kind of stuff. So for those of you who doesn't know what Quicknode is, Quicknode is a web 3.0 development platform.

And we provide a lot of different, different tools to make lives of developers easier. So let's start. So basically, what's Ethereum's vision is to create a blockchain which everyone can use without any hurdles. But since its inception, it has been the number 1 blockchain network and everyone has been using it for basically everything. So because of that, the space or the block space of Ethereum has become really expensive and the gas fees have skyrocketed.

Because of all of this, the transactions are queuing up a lot and the total finality time of transactions, a lot of times, as if they are sent with less gas. So this all relates to a concept called blockchain trilemma where each edge is a feature, you can say, for blockchain. It's scalability, decentralization, and security. So right now, Ethereum is very much decentralized and secure, but it has been having scaling issues for a really long time. So the blockchain dilemma states that at any given point of time, a blockchain network can achieve only 2 of this.

So it can be either on the edge A, B, or C. But an ideal blockchain would look like where it can stand right in the middle, where it's enough decentralized, it's enough secure because it's fairly decentralized, and then it's scalable as well. So an ideal blockchain would look like that, but since it's not ideal at the moment, so there are some scaling solutions which have been discussed in the past and which are already in the works and which are already working right now. And that's layer 2 scaling. So layer 2 scaling is basically scaling Ethereum off-chain by not scaling the actual Ethereum chain, but by settling transaction of the chain and 2 types of layer 2 solutions rollups and state channels.

So basically what rollups does is they set the transactions of the chain usually on a different chain and then they roll up the transaction information in a batch on the main Ethereum chain, usually using a smart contract. And what state channels are, state channels does the same thing. They settle the transactions of the chain but they do not send the entire transaction information as a batch on the chain but what they do is they open a state channel of the chain which is usually a multi-sig smart contract and only 2 transactions are used for the main Ethereum network. The 1 is to open the channel, the other is to close the channel. In the state channel, there are multiple parties who agrees on a transaction, because it's a multi-sig contract, who agrees on a transaction, and then the transaction is completed.

So state channels cannot be used practically because they are highly application specific. For example, there are payment state channels right now where if someone wants to send a transaction in forms of tokens, what they do is they will open a monthly contract and when both the parties who are predetermined will sign the transaction and then and then only that funds will move out of that wallet. So rollups is very like I would say practical at this moment so there has been a lot of development around rollups and basically rollups are of 2 types. The first is optimistic rollups. Optimistic rollups can be considered as kind of an angels of the blockchain where they consider that, or they consider every transaction which is being verified is valid and there is no fault in that.

So in Optimistic Rollups there is a batch maker or a batch submitter. What they do is they submit the transactions which has been happening on the sidechain or layer 2 chain and this create a batch of those transactions and submit the information batch on the main Ethereum chain and now you may ask that okay so if what if there is a fraudulent transaction in that so because to encounter that there is a third party called Fraud Proof Submitter. What they do is they identify the transaction which can be considered a fraudulent transaction, and then they submit a fraud proof. So both of these parties who are submitting the transaction batch and fraud proof, they stake their coins. And if any of the party is found guilty, their coins or ETH are slashed.

So once the fraud proof is submitted, that particular transaction is reran on the main Ethereum chain and if the transaction is found guilty or fraud then the fraud proof is approved and Bad submitter gets the eat slashed So this is how optimistic roll-up works and easy to implement because they don't require a really complex cryptographic framework beforehand, because they only need fraud-proof submitters and bad submitters. And then next type of rollups technology is 0 knowledge proof rollups. So what 0 knowledge proof does is it overcomes the assumption of a transaction being valid, but they actually validate the transaction using 0 knowledge proofs. 0 knowledge proofs are nothing but your cryptographic proofs which are generated and which validates a particular transaction without revealing much information about the transaction to other third parties. And in 0 knowledge proof, the transactions are validated beforehand and then they are submitted on the main Ethereum chain.

So because they require a complex cryptographical framework beforehand, That's why they are kind of complex to implement. And it has become really difficult for anyone to make a zero-knowledge-proof Ethereum compatible. But now we are seeing a lot of different players coming in and making zero-knowledge proof compatible Ethereum chains like Polygon ZKVM. And then there are a few challenges as well. Implementing layer 2 chains or layer 2 technologies, the first and most centralization.

So, because these chains are very scalable and they submit their transaction information on Ethereum, that part is fine, but how transactions are verified and validated on these layer 2 chains is with the help of a sequencer. So this sequencer is just 1 centralized entity, and if this particular entity gets manipulated, or if this particular entity gets bought down, the entire state chain can be compromised and be halt. And then, as we saw with ZK Proof Z or ZK Proof Knowledge Proofs rollups, it's pretty complex to implement, so complexity is also a constraint, And migration is another constraint because these are different chains. These are not the main Ethereum chain. So the funds need to be migrated from 1 chain to another.

And We all know that we have to use bridges for that, and the experience to use bridges is not that good, and they can get compromised a lot of times. And then the other point is interpolability. So the interpolability means interpolability of the data between 1 chain to another. So these chains have really good interpolability between that particular chain and Ethereum, but the interpolability between 1 L2 to another L2 is not that great, and all of this results to a bad user experience for an end user. So, that's what the challenges to implement layer 2 solutions looks like.

And this was a really short presentation for everyone who did not know what layer 2s are. But it looks like a lot of you know. And the implementations, or the best implementations for the optimistic rollups, according to me, are Arbitrum and Optimism. They have been doing a really great job at implementing layer 2s using optimistic rollups and using ZK, Polygon ZK AVM recently came up and it's completely or fully Ethereum compatible so all the smart contracts which we have on Ethereum can be run on that particular chain as well without or with less anomalies. And then ZK-Sync is working on their Ethereum-compatible chain as well, which is ZK-Sync-era.

So Yeah, this was it from my presentation. If anyone has any questions, now will be the time to ask. If you all want to connect with me, I am sensile on Twitter. If you're a new hacker and want to check out new materials or new tutorials, we have a YouTube channel where we post regular content every week to help people build different kind of applications. So, thank you everyone.

Speaker 0: You

See all Parallel Polis transcripts on Youtube

How L2 are scaling Ethereum one batch at a time / Sahil Sen