How is the development of the much-anticipated Layer2 DeFi?
Editor's Note: This article comes fromCrypto Valley Live (ID: cryptovalley)Editor's Note: This article comes from
Crypto Valley Live (ID: cryptovalley)
Crypto Valley Live (ID: cryptovalley)
, Author: Chris Powers, translation: Olivia, reproduced by Odaily with authorization.
Gas fees will be high as long as transactions on Ethereum capture significant economic value, and it's hard to imagine any short-term scenario where Ethereum block space loses value.
The impact of high gas fees may be good news for Ethereum’s scalability efforts, and it may make ETH2.0 “just around the corner,” with almost every DeFi project exploring some scaling solution. Each solution presents a set of tradeoffs around security, EVM compatibility, and speed.
Composability is DeFi's favorite hot word, but it only exists in Ethereum Layer 1, which enables a transaction to call multiple contracts at the same time.
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DEX expansion plan
Considering their scalability needs, DEXs are further along than other DeFi applications in their migration to Layer 2. In January, I researched scaling solutions for IDEX (Optimized Optimistic Rollup), Loopring (ZK Rollup), and 0x/Diversifi (ZK STARKS). This article (for the most part) introduces them and gives easy-to-follow technical explanations for each option. Let's take a look together.
In general, order book DEXs have unique needs compared to the rest of DeFi. Composability is not very important, and the design is optimized for high-frequency traders. There will be withdrawal costs and time delays when entering and exiting Layer2 at the same time, but I hope the experience will be better than that of centralized exchanges.
Loopring is currently the most viable option ($19M locked), as it comes with Ethereum's security properties. The challenge for it and other DEX rollovers is how to encourage other complementary economic behaviors as they develop.
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xDai: the hottest project now
xDai has been around since 2018 and might be more accurately described as a sidechain as it relies on a limited set of validators for security. Its STAKE token ensures the security of the network through autonomous proof consensus, which is like a proof of authority. But for the DAO to transfer assets from Ethereum to xDai requires a trusted bridge. If a bridge is attacked, any assets passing through could be stolen.
Fully EVM Compatible - Any existing contract can be deployed to the xDai chain with almost no code modification. For teams struggling with gas fees, xDai is the quickest way out.
Optimism
Supporting Metamask - Blockchain wallets are tough business, especially for Web3 wallets that require native browser integration. I would guess 90% of DeFi users have at least the Metmask browser plugin.
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Expectations are high, but the testnet shows there is still a way to go.
Fraud proofs come from OVM's ZK Snark structure and are a core component of its security profile. This testnet should be a test before the official testnet, and we need at least 6 months before the real liquidity on Optimism's official online. Uniswap founder Hayden Adams is a fan, but is the launch plan of Uniswap v3 consistent with the plan of Optimistic Network?
Siled Mobility
Ethereum's high gas fees have created a desperate need for scalability, but the market for that need is surprisingly fragmented. Some solutions exist, but they are of limited use, while others provide technical capabilities but no security guarantees, and new solutions are not ready for real prime time. This means that the DeFi landscape is still based on Ethereum, but it pushes expensive transaction fees to some Layer2 or side chains. These solutions are only composable within their respective platforms, but withdrawals and interactions with other expansion solutions are not Very troublesome."Ethereum"There may be other Ethereum Layer 2 solutions on the horizon, and the ZK and rollup revolutions may be just beginning, but other public chains, most notably NEAR, Solana, Cosmos, and Polkadot, can position themselves as similar to
Ethereum
