The Layer 2 scaling solutions industry is having a strong foothold in 2022, with more money flowing into the space in the form of institutional investments and mass adoption attested to by its growing user base.

Just last month, it was reported that ZK-Rollup solutions, in particular, are reducing transaction costs for users by almost 40 to 100 times less than the base layer.

Sequoia Capital, a venture capital firm, has reportedly launched a $600 million crypto fund with previous investments primarily focused on funding layer 2 solutions.

The growth in interest and adoption of Layer 2 solutions can be seen visibly in the data tracker, L2Beatwhich reports that the Total Value Locked (TVL) in DeFi on layer 2 platforms Ethereal The ecosystem has grown to $6.72 billion today from just $1.5 billion at the peak of the bull run in April 2021.

This is nearly 14 times the increase in TVL held across the entire Ethereum ecosystem (layer 1 and layer 2) for the same period.

This begs the question: ‘What the hell is driving this mass migration to layer 2 ecosystems?’

The answer to that lies in understanding the need for Layer 2 solutions and the differences between Layer 1 and Layer 2. Let’s go ahead and look at that.

Layer 1 vs. Layer 2

one of the most featured issues in the crypto space over the past year was the extremely high ‘gas fees’ and ignominious ‘gas wars’ that users had to wage on the Ethereum network.

This was especially painful in 2021 as the bull run brought a new stream of users to the crypto ecosystem, increasing transaction volumes and congesting the network.

While the whales and early hodlers might have been a bit miffed at the extra costs smaller and newer retailers felt the real kick in the back hoping to try that sweet decentralized ecosystem either DeFi, NFT or blockchain games. Imagine paying a $30 gas fee for a $20 transaction.

The way I like to think of this is to imagine the layer 1 network as a highway with a large queue of vehicles stuck at the toll booth, charging everyone a large number of toll fees to get the vehicles through.

The problem with this particular toll booth is that it doesn’t charge a fee based on the size of the vehicle being let through (be it a small car or a huge truck); rather, it charges a fee based on the number of vehicles stacked on the line.

Quite an inefficient system, don’t you think?

Layer 2 solutions, on the other hand, are like highway overpasses that allow more vehicles to pass through at the same time for a fraction of the cost. ZK-Rollups, in particular, are like mega trucks that haul a group of cars in their cargo through the toll booth at the expense of a single vehicle’s toll fee.

In technical terms, ZK-Rollups bundles hundreds of Layer 2 transactions into one, which is then sent to the Layer 1 backbone, reducing the data that needs to be stored on-chain.

Meanwhile, Zero-Knowledge Proofs are constantly generated to ensure consistency of Layer 1 and Layer 2 states, making every Layer 2 transaction the same level of security. security as in layer 1.

Vitalik Buterin, the man behind Ethereum, believes that ZK-Rollups are one of the best solutions in the Layer 2 space for Ethereum to scale efficiently.

What is ‘ZKSpace’?

At the moment, ‘ZKSpace‘ is one of the key players in the ZK-Rollups based Layer 2 industry. The ZKSpace platform consists of three main components:

1. ZKSwap – The innovative layer 2 DEX using ZK-Rollups technology,

2. ZKSquare: payment service that facilitates transfers and cheap payments,

3. ZKSea – an affordable and efficient minting of NFTs platform and marketplace that provides users with low gas mileage listings.

With a brand new user interface, NFT support, unlimited token listing, smoother withdrawals, optimized efficiency, and multi-chain support, ZKSpace aims to implement EVM-compatible ZK-Rollups and bring more products based to the community soon. in layer 2.

Why are token swapping and NFT minting better at layer 2?

When it became clear that transacting on Layer 1 networks like Ethereum was no longer feasible for small, frequent transactions, users quickly adapted to Layer 2 solutions like Optimism, Refereeand ZKSpace.

The migration was seamless, as most Layer 2 solutions using Rollup technology employ base layer security (Ethereum) to establish the final state of transactions while computing them at a much faster rate at the layer two.

This caused decentralized applications (DApps) and projects on the Ethereum blockchain to migrate to Layer 2 networks to facilitate higher volume and usage of their platforms.

This was especially seen in DeFi DApps and NFT platforms as they often have massive transaction volumes that are simply too expensive on a layer 1 blockchain like Ethereum.

DeFi, in particular, is an ecosystem that has been kept out of reach for users with smaller pockets due to the high gas rates on Ethereum.

Lower costs and a better user experience will help democratize access to DeFi beyond the initial group of early adopters.

ZKSwapan innovative layer 2 decentralized exchange protocol based on the automated market Maker (AMM) by ZKSpace helps achieve this vision by allowing users to list and share any CKD20 token swapping pairs by reducing gas fees to a tenth of a percent while ensuring the same security as the underlying layer 1 network.

Furthermore, ZKSwap users experience real-time trading settlements as all transactions in ZKSwap are transferred to layer 2 and users do not need to wait for a block confirmation time.

Unlike layer 1 DEXs, ZKSwap allows its users to pay the gas fee in any of the following four tokens: ETH, ZKS, WBTCand USDT. Users can also create unlimited token pairs in liquidity pools to enable trades.

The parabolic bull run of the Ethereum NFT space in the past year saw top-tier projects like Crypto Punks and Bored Ape Yacht Club (BAYC) paste sales record weekly.

However, since NFT projects on the Ethereum blockchain were expensive to launch due to the high gas fees paid to mint the tokens, most of the projects that emerged had a high minting price in addition to the ” gas wars” that isolated investors. , large and small, to participate in the mint.

This gas tariff issue also prevented most NFT projects from achieving true price discovery, leading to the creation of artificial floor prices.

The NFT ecosystem was in dire need of layer 2 solutions, such as Immutable X and ZKSea, that were tailor-made to facilitate a smoother minting and trading process for NFTs.

ZKMarZKSpace native NFT MarketSupports all ERC721 standard NFTs to be freely deposited and withdrawn between Layer 1 and Layer 2 directly.

This allows block chain games and metaverse projects to truly take advantage of the security of being deployed at the base layer while enjoying the low transaction costs of the layer 2 platform.

ZKSea also provides full layer 2 purseallowing users to manage ERC20 and NFT tokens easily.

ZKSea allows users to mint NFTs at a gas fee of $5 per creation. After the artists mint the NFT, it can be put up for sale on the market without gas fees.

Open sea, a layer 1 NFT marketplace on Ethereum, also charges a 2.5% platform fee similar to ZKSea; however, listings on Opensea are subject to Ethereum gas fees, which can range from a few dollars to a few hundred dollars.

Additionally, if an artist wishes to delist an NFT on Opensea, they are once again subject to paying a hefty gas fee, which is many times higher than ZKSea’s $1 delisting gas fee.

ZKSpace really aims to bring a smooth and user-friendly Layer 2 experience to users with an ever-evolving list of features through its ZKSwap and ZKSea products.

The protocol is also launching its own mobile app for Android and iOS users that allows users to access all web features through the app. App users can engage in activities such as deposits, withdrawals, transfers, redemptions, and mints.

List of top tier NFTs supported for the PoD mining program

by ZKSpace ongoing mining programs allow ZKSwap users to mine the protocol’s native ZKS token by providing liquidity or trading certain token pairs on ZKSwap during the campaign period.

ZKSea users, on the other hand, can mine ZKS tokens by depositing and listing one of the above-specified Tier 1 Tier 1 NFTs on the platform during the campaign period.

All mining events on the ZKSpace web app, ranging from PoS and PoG to NFT PoL, NFT PoT and NFT PoD, are currently available on the mobile app as well.

You can now earn daily mining rewards and exclusive bonuses with your tokens and NFTs.

Final thoughts and future plans

One of the most common misconceptions when it comes to the future of layer 2 protocols is that they will become obsolete once Ethereum’s next consensus layer (formerly known as Eth 2.0) merges with the execution layer (formerly Eth 2.0). 1.0).

Unfortunately, all the merger does is make the blockchain greener by changing the consensus mechanism to proof of stake (PoS) and kick off the deflation mechanism for the ETH token as a result of EIP-1559.

Scalability, however, remains unchanged. This is because transaction performance happens at the execution layer, which is not affected by the merge.

of ethereal view to increase the scalability of your network is to implement multiple sharding chains alongside the existing layer 2 solution that is currently being implemented on the blockchain.

This is bullish for the Layer 2 industry as a whole, as it implies a greater focus on coexistence and reliance on Layer 2 solutions to drive Ethereum’s scalability in the future.

Ethereum’s vision of scalability also aligns with ZKSpace’s mission to provide its users with a more diverse set of features as the protocol develops.

The protocol plans to launch features such as NFT verification, batch minting, auction, bidding services, and layer 2 domain services before the end of this year.

However, one goal that sets ZKSpace apart from other Layer 2 solutions in the space is its vision of providing cross-chain Layer 2 services by deploying other Layer 1 blockchains besides Ethereum, such as BSC Y Solarium.

This will provide users with faster and cheaper cross-chain services and make it affordable to transfer funds at Layer 2 between different chains at low cost.

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