An overview of the cryptocurrency layer2 full ecological solution
Editor's Note: This article comes fromGolden Finance, reprinted by Odaily with authorization.
Editor's Note: This article comes from
Golden Finance
Golden Finance
, reprinted by Odaily with authorization.
Layer2 is a very suitable solution to solve the problem of cryptocurrency network expansion.
The bottom layer of each encrypted currency network is resource and communication, which is layer0. Layer1 is the layer with consensus. Layer1 produces blocks through consensus algorithms and is responsible for the security of the network. However, layer1 will have certain restrictions, because large-scale consensus and high efficiency are contradictory, so layer1 cannot solve the problem of network congestion. , that can only bypass the congestion and open up another road, which is layer2.
In theory, if it is not a process on the chain, it is "layer 2", such as bridges, relays, and gateways, which can be used for information transfer. But in order to achieve security, the definition of layer2 must be some solutions with security. For example, a smart contract, a network with node verification capabilities.
Because layer2 ultimately implements the update of the account balance of layer1 under the condition of ensuring security, in most cases, the two-layer accounts will be associated with a balance change. The simple understanding is the change of the layer1 ledger and the layer2 associated ledger. In most cases The lower layer2 is realized through smart contracts.
For example, if a contract is used to make a cryptographic addition and subtraction correspondence between the address books of the two parties to the transaction, this is a technical solution such as the Lightning Network. If a technology such as zero-knowledge proof is added to the ledger transfer process, the transaction message with proof goes through layer2 once, and the information is transmitted safely. This is layer2 expansion proved by zero-knowledge proof. If layer2 has a separate network, there must be network nodes that can perform separate verification. This layer may have a separate consensus, and some contracts can be run in the network to perform changes in associated accounts. This is some sidechain solutions.
The performance of most cryptocurrency projects in layer 1 is not enough, so many networks will have layer 2 solutions. For example, in terms of ecology, it has its own layer2 design for Bitcoin, Ethereum, Polkadot, Alliance Chain and other altcoin networks.
This article will make general statistics on the layer2 schemes to distinguish the differences of each layer2 scheme for readers, including the main layer2 projects of Bitcoin, Ethereum, Polkadot ecology and some layer2 scheme examples of other chains.
There is also an interesting inference here, because of the layering problem of layer2, many combined solutions can be called layer2, such as the multi-chain structure of cross-chain ecology, which are even layer2 of layer2. When the cross-chain technology matures, Cross-chain will also be a major possibility for expansion, because from the top-level design, cross-chain is heterogeneous sharding.
1.Lightning Network
In addition, when differences between networks are not considered, there are many cases of expansion solutions, such as the Bitcoin liquidity solution implemented by Ethereum through synthetic assets, which has prompted Ethereum to become layer 2 of the Bitcoin network, that is, the largest The "side chain".Let's take a look at layer 2 of the cryptocurrency shown in the figure below through the classification of projects.Bitcoin ecology
2.Liquidity
Status channel:
3.JellySwap
Lightning Network (Lightning Network) The excellence of the Lightning Network is that it can realize a real-time and massive transaction network without trusting the other party or a third party. The Lightning Network evolved based on the micropayment channel, and creatively designed two types of transaction contracts: RSMC (Revocable Sequence Maturity Contract) and HTLC (Hashed Timelock Contract). RSMC solves up the channel
One-way flow problem, HTLC solves the problem of currency transfer across nodes. The combination of these two types of transactions makes up the Lightning Network.
Side chain:
4.RSK
Similar to Lightning Network, Liquidity Network also expands Bitcoin through state channels, and Liquidity Network is also an expansion solution for Ethereum. There are no costs to pay on the blockchain when making transactions. What the user pays is the fee for opening and closing the channel, instead of paying for the intermediate process. The solution utilizes an offline transaction scheme called Revive.
JellySwap is an exchange for cryptocurrency transactions such as Bitcoin, and the bottom layer is a cross-chain transaction protocol, which allows users to trade between chains. Jelly just sets up a state channel between chains, and it also uses the same as the Lightning Network. The HTLC scheme realizes asset exchange.
Technical structure of JellySwap
5.Ren
Side chain:
6.imBTC
RSK is Bitcoin's smart contract platform. It can be understood as a side chain, which establishes RVM (RSK Virtual Machine) by establishing a network and forking EVM (Ethereum Virtual Machine), so that RSK is compatible with Ethereum smart contracts and tools for deployment and interaction with them.
7.WBTC
To help Bitcoin expand, it is achieved by establishing R-BTC on the network, and there are exactly 21M R-BTC in RSK. In this way, it is enough to lock the corresponding accounts of the two networks through the smart contract, which can allow the transfer of Bitcoin from the Bitcoin network to the RSK blockchain, and the gas fee and efficiency of the transaction process can be effectively reduced.BTC"Ethereum anchor currency":
8.pToken
Ren is the name of a protocol, and RenVM can be called a Byzantine Fault Tolerant (BFT) network that enables universal interoperability between blockchains. Ren is a protocol built on Ethereum. Protocol By combining consensus with a secure Multi-Party Computation (MPC) algorithm, RenVM can instantiate a decentralized, permissionless and trustless custodian, which allows assets to be locked on a chain and shared in a one-to-one manner Fixed assets of other chains. When trading, only one transaction dapp can interact with multiple assets of multiple multiple chains. For Bitcoin, RenBTC is generated.
Like the Ren protocol, imBTC is also an asset issued on Ethereum. It is issued by the multi-chain wallet imToken. The anchored Bitcoin is generated by locking Bitcoin on Ethereum. Behind it is the transaction of imToken's DEX Tokenlon in Ethereum protocol.
WBTC is an anchor currency protocol issued on Ethereum, and WBTC is issued by locking Bitcoin
, WBTC can be used for DeFi applications on Ethereum and other applications.
9.Raiden Network
pToken is a synthetic asset protocol on Ethereum. The assets issued through this protocol support the locked-in issuance of multiple chain assets, mainly serving the DeFi combination of cross-chain assets. In order to integrate Ethereum assets and non-Ethereum assets, pToken has built some cross-chain "bridges" through hardware devices.
10.Celer
The technical structure of pToken
11.PISA
Ethereum ecology:
12.Liquidity
Status channel:
13.Connext
Raiden Network is an off-chain scaling solution that complements the Ethereum blockchain and can also serve as a scaling channel for any ERC20 token. Raiden's state channel implementation, similar to Lightning Network.
14.State Channels
Celer Network is a layer2 extension platform that provides fast, easy and secure off-chain transactions for payment transactions and generalized off-chain smart contracts, also through state channels. But different from other state channels, the concept of Celer Network is very independent in the off-chain part. The off-chain structure has its own network and security mechanism, which can realize many transaction processing outside of financial transactions. In this way, it is easier to build dapps under the chain.
PISA Research, the research institute of PISA, aims to build smart contracts with globalization, privacy protection and self-execution through off-chain protocols. The goal is to enable transactions with little consumption. The scheme studied by his team is similar to the design of the state channel, and an off-chain transaction scheme called SoK is proposed.
15.OVM
Similar to the Lightning Network, the Liquidity Network also expands networks such as Bitcoin and Ethereum through state channels, and there is no need to pay the cost on the blockchain when conducting transactions. What the user pays is the fee for opening and closing the channel, instead of paying for the intermediate process. The solution utilizes an offline transaction scheme called Revive.
Connext is an Ethereum-based protocol that can also be deployed on other blockchains. The protocol uses a network state channel system, and the cross-chain routing and micropayment layer of the decentralized network can be established on Connext. Instant, near-free transfers can be made, as well as across chains, and liquidity can be achieved in any asset.
16.Arbitrum
Rollup-based:
Side chain:
17.Matic
An execution environment that is fully compatible with OVM and EVM, and is suitable for Layer 2 expansion. It is a Solidity smart contract that can be executed using rollup through OVM, and interacts with the blockchain through Web3 API.
18.OMG
With OVM, porting dApps to L2 is no longer a big project at the architectural level, only simplified deployment operations remain. And it is also possible to consider tight coupling (tight coupling) and composability (composability) in the construction of dApp, and new smart contracts can be deployed to the chain using OVM at any time.
19.Skale
Arbitrum Rollup is an off-chain protocol managed by contracts on the Ethereum chain. In order to enable their own applications to run on Arbitrum Rollup, dApp developers can write a set of contracts in Solidity, and then compile these contracts into Arbitrum virtual Executable code that runs on the machine.
20.Loom
Side chain:
21.POA
Matic Network realizes the expansion and speed-up of the public chain by using the side chain for offline calculation. As a side chain, Matic Chain has an independent consensus mechanism and friendly development tools and environment.
The OMG Network utilizes a layer 2 Plasma architecture to build scalable, decentralized payment applications on the network. It allows high-throughput, low-cost peer-to-peer transactions, facilitating financial services across geographies, asset classes and applications. The OMG Network allows you to access, manage and process digital assets held securely on the blockchain.
22.Stark
SKALE is a sidechain network run by independent validators located around the world". Validators run SKALE nodes, which contain many containers/components and can participate in multiple sidechains. One SKALE validator can run multiple S-chains at the same time , system users can configure the number and capacity of validators for each S-chain.
23.zkSync
Loom Network is a platform-as-a-service built on top of Ethereum that allows developers to run large-scale decentralized applications. This allows developers to build the trust and security of the world's most secure public blockchain and the computing resources needed to run commercial-scale services. Each DApp can run on its own blockchain (side chain), and its data is public and forkable, just like Ethereum and blockchain. Adjustable security enables higher throughput while submitting "checkpoints" to the main chain in order to declare the integrity of data up to date.
POA Core is an autonomous network secured by a set of trusted validators. All validators on the network are US notaries whose information is publicly available. The POA organization also develops products and tools to improve interoperability, infrastructure and transparency across the ecosystem. These include BlockScout, an open source resource manager, and TokenBridge, a multi-chain asset transfer solution. Participating in POA Core can help you experience and create best-in-class applications on our platform.
24.Loopring
Zero knowledge proof:
StarkWare will use STARK technology to improve the scalability and privacy of the blockchain, providing zero-knowledge proofs and post-quantum secure cryptographic proofs. StarkWare will develop a complete proof stack: software and hardware, enabling fast and reliable generation and verification of proofs of computational integrity for general computing.
25.ZKSwap
zkSync is Ethereum's scaling and privacy engine. Its current scope of functions includes low-priced transactions of Ethereum (ETH) and ERC20 tokens in the Ethereum network.
zkSync is built on the ZK rollup architecture. ZK Rollup is a two-tier scaling solution, where all funds are held by smart contracts on the main chain, while computation and storage take place off-chain. For each aggregated block, a state transition zero-knowledge proof (SNARK) will be generated and verified by the main chain contract. This SNARK includes proofs of the validity of each transaction in the rollup module.
26.Celer
For developers, the Loopring protocol is an open source protocol for building a decentralized trading network. Through a set of open source tools, developers can use zkRollup two-layer network technology to build high-performance, non-custodial Decentralized exchange.
27.Plasm
For ordinary users, the one that is closer to daily life is the Loopring Exchange on Ethereum, which is also the first high-performance decentralized exchange based on the Loopring protocol (the number of transactions per second is said to be 2000 Second-rate). When using it for the first time, the exchange will generate a second-tier network account for the user, and the process will take about 5-30 minutes.
ZKSwap is a new exchange protocol based on Zk-Rollup technology launched by L2 labs. It transfers ERC-20 assets to Layer2 through the Zk-Rollups algorithm, and based on the zero-knowledge privacy algorithm to ensure that the state of Layer1 and Layer2 is consistent, achieving zero Gas Real-time exchange of fees. Users do not need to wait for block confirmation, it is easier to use, lower cost, and has unlimited scalability. It gets rid of the TPS and transaction time restrictions of Ethereum, allowing DEX to have a high-quality user experience of CEX (centralized exchange) and real-time control of fund security.
Polkadot ecology:
Celer Network is a layer2 extension platform that provides fast, easy and secure off-chain transactions for payment transactions as well as generalized off-chain smart contracts. Different from other state channels, the concept of Celer Network is very independent in the off-chain part. The off-chain structure has its own network and security mechanism, which can realize many transaction processing outside of financial transactions. In this way, it is easier to build dapps under the chain.
We are finishing a plasma module called "Plasm". Using our modular platform, any developer can create a high-speed blockchain with plasma technology in minutes. We use Substrate, which makes it easy for anyone to create custom blockchains. By connecting Plasm to Substrate, any developer can create a high-speed blockchain.
Other ecological layer2 thoughts:
As we said earlier, in a broad sense, there are many designs called layer2 solutions. It is still based on the structure of computing in the off-chain part outside the consensus layer. If it is designed to be calculated and stored outside the consensus layer, and the consensus layer confirms the final ledger, this can be used as a layer2 technical solution.
