Blockchain scalability ZK Rollups

Scalability is without a doubt the biggest problem facing today's blockchains. Current blockchains (such as the bitcoin blockchain and Ethereum blockchain) have relatively low transaction speeds and high transaction costs. In order to grow, the blockchain must become more scalable. Solutions to make the blockchain more scalable is through layer 2 solutions. One of these solutions is the ZK. Rollups.

What are ZK Rollups?

As stated in the introduction, ZK Rollups are layer 2 solutions. These solutions seek to improve the scalability of blockchain. Layer 2 solutions is a layer on top of the blockchain outside the original blockchain where all transactions are verified. The original blockchain is not changed and the layer 2 solution does not affect the underlying blockchain either.

If there are many transactions on the blockchain, then the blockchain becomes congested and transaction costs increase because the miners have to work harder. Therefore, the miners will process the transactions with the highest transaction costs first. Because Ethereum is so popular and so many transactions take place on it, the blockchain becomes congested. Ethereum's transaction cost is relatively high.

Another goal of Layer 2 solutions is to get the transaction costs down so that more transactions can take place.

ZK Rollups attempt to increase scalability by mass transferring transactions through a single transaction. So we put thousands of transactions in one transaction. So we do this through a "zero knowledge proof" (ZK). The ZK reduces the energy and storage resources required to validate and verify a block. We do this by reducing the amount of data stored in a transaction. Since less data is required, more space is left for other transactions.

How do ZK rollups work?

So ZK Rollups are solutions that perform transactions outside the mainchain (original blockchain) but place transaction data in the mainchain. Because transaction data is placed in the mainchain, transaction data that originates on the Rollup can be secured on the mainchain. This is an important feature of a ZK rollup.

• What are the properties of Rollups?
  Transactions and the data do not take place on the mainchain (layer 1) but off-chain, the Roll up chain exist as a layer on top of the original blockchain.
• The transaction and its verification all take place on the mainchain.

ZK Rollups have executors - relayers - who stake a portion of their Ethereum into a particular Rollup smart contract. This incentivizes the relayers to correctly verify and execute transactions. This keeps the network secure.

ZK Rollups aggregate bundles (Roll-up) hundreds of transactions from data off chain (from the roll chain) and then generates a cryptographic proof. This is also called the z-SNARK. The zk-SNARK stands for "zero-knowledge succinct non-interactive argument of knowledge". Quite a mouthful.... The zk-SNARK is the proof that thousands of transactions in the form of a single hash and is eventually placed on the mainchain.

Because it only takes a single hash to represent thousands of transactions (instead of just 1 transaction = 1 hash), the blockchain can become more scalable.

• Zero-Knowledge Rollups (ZK-Rollups) are smart contracts that scale the Ethereum network by processing multiple transfers off the main blockchain. ZK-Rollups work by taking hundreds of transfers off-chain and combining or "rolling" them up into a single transaction. It then submits a SNARK (succinct non-interactive argument of knowledge) back to the main chain as proof of validity. Validating a block with a ZK-Rollup is faster and cheaper since less data is included.

Relayers 

Relayers collect thousands of transactions to create a Rollup (bundle/merge transactions). Any participant of the Ethereum network (or the blockchain on which the rollup takes place) can become a relayer. This is only possible if the required amount of ETH has been staked in the smart contract.