, is a special column for us to observe and analyze projects in the Polkadot ecosystem from the perspective of different ecological niches. Polkadot is a highly scalable project that can accommodate many ecological niches,
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Polkadot Ecological Observation, is a special column for us to observe and analyze projects in the Polkadot ecosystem from the perspective of different ecological niches. Polkadot is a highly scalable project that can accommodate many ecological niches,By observing the ecological niche, we can perceive the overall situation and clearly understand the overall development of Polkadot; we can also observe the details and find out which ecological niches are in a state of fierce competition or a blue ocean.secondary title
backscene
If it weren't for the recent decline in the encryption market, most people would have struggled to transfer an ETH on Ethereum. After all, the decline in the market has led to fewer transfers and a corresponding reduction in transfer fees. Now a transfer The fee is less than 2USDT, which was unimaginable a few months ago.
Although the current gas fee seems to be very friendly, it is only the result of environmental changes. It is necessary to know that the congestion problem of ETH has become a "big problem". The reason why the chain claims to destroy Ethereum, after all, the congestion problem and high transfer fees seem to be criticized, but after many years,Those public chains that are showing off their power in front of Ethereum have almost disappeared, and there is only another group of emerging players-Layer2 team。
Maybe Layer2 was not favored by the industry a few years ago. Some teams that claimed to be Layer2 tracks at the time have actually changed a batch. After all, this story does not sound as exciting as "beyond Ethereum", but things are developing. This year, some changes are taking place,Many Layer 2 projects have sprung up like mushrooms, and even became a hot spot in the industry in the first one or two months, and the amount of financing is also rising, the angel round of many projects has exceeded 1 million US dollars in funding.
Therefore, as a big ecology like Polkadot, it is also necessary for us to understand the development of Layer 2 in its ecology. Some people may say that Polkadot does not need Layer 2, but Layer 2 is an emerging technical solution, and we cannot make a conclusion too early. From the development of the Layer2 project in the Polkadot ecosystem,LThe potential of ayer2 should not be underestimated, this is a direction worthy of our attention and research。
What exactly is Layer2?
1. Definition of Layer2
Layer 2, also known as a two-layer network, as the name implies, is a new layer of network expanded relative to Layer 1. According to the more common definitions at present, we can’t describe Layer2 only from Layer2 itself, but also discuss Layer1. This is like describing what an egg is, and we have to mention what a chicken is.
When Bitcoin was first born, it was more than sufficient for small-scale value transfer, and there would be no problem of network congestion. However, when more and more users enter the Bitcoin network a few years later, congestion will naturally occur. This is similar to the problem with Ethereum. If it weren't for the emergence of CryptoKitties and a large number of applications on Ethereum, maybe everyone would not criticize the congestion of Ethereum.The fact is that the development of Ethereum has shown a leap forward with the subsequent explosion of DeFi, and the number of applications on its network has also increased day by day, and congestion has naturally become a common occurrence.。
then,
then,Someone thought of improving the performance of Layer1 by means of expansion, which can be divided into two categories. One is to extend the Layer1 level, and the representative of this category is fragmentation, we can understand that the original Layer 1 is like an accounting firm A with 10,000 accountants calculating and recording the books, but every time a new page of accounts is calculated, each accountant needs to calculate, post the accounts and send them to next person. But if there are too many transactions that need to be accounted for, and they cannot handle them, there will be delays, that is, congestion on the chain. And sharding is like dividing the 10,000 accountants into 50 groups, each with only 200 people, and the speed of calculating a new page of books is dozens of times faster. This is the extension done at Layer1.
but there areAnother way of thinking is to split some transactions that need to be calculated on the chain, and put some transactions on another chain to complete through smart contracts and mechanisms. This is the solution at the Layer 2 level.case. This solution, according to the analogy of accounting firm A just now, is equivalent to handing over many transactions that need to be calculated to another accounting firm B for calculation, and then accounting firm B calculates the results and returns the results To A, thus completing the recording of all transactions. This is to find foreign aid, that is, the second-tier network, to assist in computing and achieve the effect of expansion.
After various attempts, we now habitually refer to the main chains such as Bitcoin and Ethereum as Layer 1, and the part that extends it as a functional supplement or reduces the burden on the main chain to provide efficiency is called Layer 2. Of course, from the perspective of consensus, Layer 2 is only a partial consensus, and its decisive significance is still Layer 1. So far, we have roughly explained the relationship between Layer 1 and Layer 2.
If you have to use another metaphor to describe the relationship between Layer1 and Layer2, it is probably the state of the head office and the branch. so,When the head office is now a foregone conclusion, the development of branch companies will inevitably become a track for capital pursuit. After all, the best branch company (Layer 2) has not yet emerged.。
It is worth noting that Polkadot itself is not Layer1 or Layer2, it is closer to Layer0, or called meta-protocol (we have introduced it in detail in the popular science knowledge), and its parachain plays the function of Layer1, which is why The reason why Polkadot has infinite scalability.
2. What is the significance of Layer2?
We mentioned earlier that the development of Layer 2 is a key and hot direction of the industry, so what kind of magic is hidden behind it, making it the current "fragrant momo" in the industry, and we try to explore it from two angles This level of meaning is for everyone to understand.
2.1 Performance extension
First of all, the most intuitive significance of Layer 2 is that it brings performance expansion to Layer 1, that is, it directly hits the core pain points, solves the congestion problem of the main chain or the problem of high handling fees, and this is inThere seems to be a good chemical reaction in the current Layer2 network。
For example, the current popular Ethereum Layer 2 network Polygon can reduce the transaction speed to a few seconds to complete, achieving a truly silky experience, and its cost is about 0.00002 US dollars, which can be described as exponentially lower than Ethereum, so The Layer2 network can indeed improve the performance of the main chain in a great sense, and even completely change the stereotyped image of the main chain.
This should be the most direct change brought about by the current Layer 2 project, and it is also the most well-known direction, and the Layer 2 project has indeed played the role of a "follower" who is qualified to share the pressure of the main chain.
2.2 Function extension
In addition to changing the state of the main chain in terms of performance mentioned above, there are still many Layer 2 networks that carry the upgrade function of Layer 1. Their existence is not only to improve the functions of Layer 2, but also to increase the functions of the main chain, such as giving The addition of smart contracts to the main chain without smart contracts such as Bitcoin enables it to have some functions like Ethereum. The Polkadot ecological project ChainX we mentioned before and the RSK (Rootstock) that was popular a few years ago both acted as such a role.
With the popularity of DeFi and more funds entering the cryptocurrency field, the privacy protection of transactions and assets has gradually become the direction of everyone's concern. However, Layer 1, such as Bitcoin and Ethereum, did not consider privacy functions at the beginning of their design. In general, the function of adding privacy computing through Layer 2 is also the direction of many teams' efforts.
Of course, such a Layer 2 project is not currently the most mainstream track. After all, the effect of adding functions cannot keep up with the reality of dealing with pain points. Even in the Polkadot ecosystem, these functions can be realized through parachains, naturally not Then get attention,But there are also some high-quality projects. They can not only improve the performance of the main chain, but also bring other functions to the main chain, playing a powerful role。
To sum up, it is not difficult to find that Layer2 has indeed changed some of the current industry patterns, and may even bring some unexpected surprises, which is why it has become the current popular track.
The basic situation of the current popular Layer2 technology
state channel
state channel
The essence of the state channel is that the main chain acts as a judge, the two parties to the transaction open the state channel by establishing a decentralized check and balance mechanism on the main chain, conduct transactions under the chain and confirm the state change, and finally upload the final result of the transaction and close the state channel. The main chain creates a smart contract to act as a judge to ensure the authenticity of the transaction.
Since the instantaneous transaction is carried out inside the channel and will not be broadcast or recorded on the main chain,So the state channel has good privacy. It is also instant finality, which is ideal for participants that need many state updates over a long period of time. However, state channels are more suitable for applications with a certain set of participants, and require participants to stay online at all times. Each opening or closing of a state channel requires an on-chain transaction. Therefore, it has certain limitations. Therefore, state channels are often suitable for small transactions, and cannot carry such a large transaction volume as exchanges, and the channel setup also takes a certain amount of time.
Lighting Network, Celer Network, and Radien Network all apply state channels.
Side chain technology
Sidechain technology is a technology that enables value interaction between the main chain and the side chain. The side chain can be connected with the main chain one-to-one, just like symbiosis. Its essence lies in the two-way anchoring of the main chain and the side chain. When the assets of the main chain want to be transferred to the side chain, it is necessary to lock the corresponding number of tokens, and then release the equivalent value of the side chain tokens. Conversely, if the tokens want to be transferred back to the main chain, the number of side chain tokens will be locked and the corresponding main chain tokens will be released.
The advantage is that,When the transaction on the main chain cannot be processed, part of it can be transferred to the side chain. Improved the throughput of the main chainHowever
HoweverSidechain technology itself also has many flaws, such as high complexity, possible fraudulent transfers, risks of centralized mining and soft forks. The current typical applications are ConsenSys' BTC Relay, Rootstock, Injective, Element Chain launched by BlockStream, and the non-Bitcoin side chain Lisk.
Plasma
Plasma is actually a kind of side chain, which is a side chain with non-holding properties. Plasma was first proposed by V God and Joseph Poon of Ethereum in 2017. It is essentially an independent blockchain suitable for transactions between any users. It is anchored to the main chain of Ethereum and uses fraud proofs to resolve arbitration disputes. .
To put it simply, compared with the usual profile, Plasma transfers the transaction throughput of the main chain (Layer 1) to Plasma (Layer 2), and Plasma (Layer 2) converts the data about the transaction sequence into a hash value and stores it in the main chain (Layer1), and an exit mechanism for fraudulent proofs is added, so that people can transfer assets on the chain by sending off-chain messages, which also utilizes the computing power of the main chain (Layer1) to ensure the security of Plasma (Layer2) .
Plasma greatly improves the throughput of transactions. However, since Plasma only puts the data outside the chain on the main chain for notarization, there are certain defects in data availability.At the same time, Plasma itself does not support low-latency transactions, and sometimes it will cause transaction delays。
Plasma's many innovations have attracted the attention of many projects, and Polygon (formerly Matic), OMG, etc. have deployed Plasma. But new technologies are also iterating. The maturity of a technology also inspired the Plasma team to propose a more novel Layer 2 solution, which is the Rollup technology.
Rollup turned out to bring a new layer2 track
The concept of Rollup can be traced back to 2014, and was called "Shadow Chain" by Vitalik Buterin, the co-founder of Ethereum, that is, the shadow chain. Rollup builds on the "Shadow Chain" idea to achieve data availability by enforcing state off-chain and using only the Ethereum blockchain. Rollup's block release or status update only publishes some data to the main chain of each transaction through tx CALLDATA, which improves throughput and overcomes the data withholding attack problem of the side chain.
The emergence of Rollup has inspired many teams concerned about the Layer 2 track. Then, according to different ideas, Layer 2 began to evolve two different routes. One is a route that uses zero-knowledge proof. The more representative ones are ZK Rollup and Validium ; The other is a route that uses fraud proofs, the more representative one is Optimistic Rollup.
ZK Rollup
ZK Rollup is an improvement plan for Optimistic Rollup proposed by Barry Whitehat and Vitalik in the second half of 2018.Its essence is to compress and store the change of the user state on the chain in the Merkle tree, use zero-knowledge proof to ensure the correctness of the change process, and submit the proven Proof to the chain.
Its advantage is that the main chain does not need to verify the legitimacy of each transaction separately, but only needs to verify the validity of Proof, which greatly improves the throughput of the main chain.Its state transition strictly depends on cryptographic proofs, ensuring security. At the same time, the availability of data allows anyone to restore the overall situation of the account based on the transaction data stored on the chain, thereby eliminating the security risks caused by data availability. And in simple payment, transaction and other specific application cases, ZK Rollup can greatly reduce the cost on the chain.
However, due to the high computational cost of zero-knowledge proofs, it is necessary to pay a high gas fee to run complex smart contracts. At the same time, the language of ZK Rollup is relatively complicated, and it is not particularly friendly in terms of compatibility with EVM, which has hindered its application to a certain extent. Currently StarkWare, Lien, and Tether are all deployed in ZK Rollup.
Validium
Validium is a Layer 2 scalability solution for Ethereum, where the validity of all transactions is enforced using zero-knowledge proofs.Each value transfer from a specific user account needs to be authorized by the user, thereby improving the security of user assets。
We can see that Validium and ZK Rollup have many similarities. The difference is that ZK Rollup has the availability of on-chain data, while Validium only has the availability of off-chain data. Therefore, the throughput of Validium will be much higher, but because its data availability is off-chain, it has not achieved complete decentralization, which will lead to its operators being able to dominate users' assets and have poor resistance to attacks. Therefore, Validium will be more suitable for game-type DApps, but cannot undertake financial scenarios such as payment and transactions with high security requirements.
The current NFT trading platforms Immutable X, StarkEx, and Zk-porter have deployed Validium.
Optimistic Rollup
Optimistic Rollup is a Layer 2 solution launched by the Plasma team after it transformed from a research group into a profitable start-up company called Optimism.
The team launched an internal test environment for the Optimistic Virtual Machine (OVM). OVM is built on top of EVM and aims to provide Optimism's Layer 2 solution with the same smart contract services as the underlying blockchain.
OVM can bring together all the different Layer 2 solutions. Layer 2 solutions such as Plasma, state channels, and Optimistic Rollup have been proof-of-concept on OVM. Optimistic Rollup also draws heavily on the design of Plasma and ZK Rollup in terms of structure.
Optimistic Rollup essentially defaults to the validity of transactions, and is an EVM-compatible Layer 2 scalability solution based on fraud proof operations. Optimistic Rollup has many advantages such as trust-free, hosting-free, license-free, and expressiveness. However, the transaction does take a long time and the withdrawal of funds is delayed, which has certain risks.
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Arbitrum Rollup
Arbitrum Rollup is developed by the OffchainLabs team and is a Layer 2 expansion solution for Ethereum.It is essentially an off-chain protocol managed by contracts on the Ethereum chain using Rollup technology.To put it simply, Arbitrum puts the actual calculation and storage off-chain, and optimizes and compresses the transaction data and records it on Ethereum to ensure security, thereby increasing throughput and reducing transaction costs.
Based on this, the security of Arbitrum Rollup can be guaranteed, and it is fully compatible with Ethereum EVM. Anyone can deploy smart contracts on Arbitrum, and it has very high scalability and low cost. However, since all Arbitrum transaction data will be published on Ethereum, the number of transactions that can be released per unit time is still limited by Ethereum, and the effect of full expansion cannot be achieved.
Currently, Uniswap, SushiSwap, decentralized trading platform DODO, decentralized exchange Bancor, and decentralized derivatives trading platform MonteCarloDEX have all been deployed in Arbitrum.
Layer2 ecology on Polkadot
Compared with Layer 1, which is a comprehensive public chain such as Ethereum, BSC, Solana, etc., the parachain as Layer 1 in the Polkadot ecology is more specialized, and for Layer 2, Polkadot itself has a surprise. Let's first take a look at the situation of the projects involving Layer2 in the Polkadot ecosystem.
ChainX
ChainX is the first project developed and launched based on the Substrate framework, dedicated to the research and application of Bitcoin Layer 2 expansion, digital asset gateway and Polkadot secondary relay chain.
As early as 2019, ChainX has successfully cross-chained BTC to ChainX, and generated the cross-chain asset XBTC. The XBTC transfer can be done in only 6 seconds (because the block generation time is 6 seconds), and the transfer fee is only 0.00015 pcx, which is less than 1 cent. Then on November 16, 2019, ChainX released the Bitcoin smart contract platform. ChainX used its development experience in the Substrate field to connect the new smart contract to Bitcoin, thereby realizing the new functions of Bitcoin.
ChainX connects BTC with ChainX through cross-chain, andBTC has brought a substantial increase in transaction throughput and a substantial reduction in transfer fees, and also endowed BTC with the function of smart contracts, bringing performance expansion and functional expansion to BTC.
Celer Network
Celer Network is a Layer2 platform,Aims to bring fast, secure and low-cost DApps on Ethereum, Polkadot and other blockchains to the masses。
Celer Network was the first to do the direction of the state channel, and then launched the world's first general state channel network, and with the emergence of various emerging technology solutions Rollups (Optimisitc Rollup, ZK Rollup, etc.) of Layer 2,Celer Network is also using advanced Rollup technology to promote the cutting-edge development of Layer2 expansion technology。
On February 19, 2021, Celer Network launched Layer2.finance, a DeFi expansion and acceleration solution based on Optimistic Rollup, aiming to use Layer2's Rollup solution in different ways. Similar to other Rollup schemes, users can deposit funds into the Rollup chain of Layer 2.finance by performing a deposit transaction on the Rollup contract on Layer 1, but Layer 2.finance will not migrate the DeFi protocol itself to Layer 2.
Currently, CelerX, cBridge, Layer2.finance and other applications and middleware built on Celer Network have attracted more than one million users in the fields of games, DeFi and blockchain interoperability.
Astar Network
Astar Network is the new name after the brand upgrade of Plasm Network. The original Plasm Network is more positioned to implement Layer 2 technology on Polkadot. Now with the brand upgrade, Astar Network has a new positioning. The current positioning of Astar Network To become a dApp center on Polkadot, it will support Layer2 solutions such as Ethereum and ZK Rollups.Astar aims to be a multi-chain smart contract platform that will support multiple blockchains and virtual machines such as EVM and WASM。
However, it should be noted that,The new positioning of Astar is not a change of track, but a positioning with a broader prospect based on the original foundation.. In fact, it is understandable for Astar to upgrade its brand, because according to its previous positioning, it wants to implement various Layer 2 solutions on Polkadot, but in fact it has basically completed this goal.
At the beginning of its establishment, Astar considered that Layer 2 has great potential, so they chose to adopt the Plasma team supported by the Ethereum Foundation at the beginning, and then transformed into the OVM developed by the Optimism team. This also means that Astar will also support virtual machines of all Layer2 protocols.
And in March of this year,Astar completed the function implementation of another important Layer2 solution ZK Rollup on Astar. Basically, they have completed their previous positioning goals, so it is only natural for Astar to transform and reposition a higher and broader goal.
For Layer2, what is the surprise of Polkadot itself?
It can be seen that since Polkadot itself can fully support EVM and Solidity (after all, the founder of Polkadot knows Ethereum best), many projects in the Polkadot ecosystem can quickly integrate existing mature Layer 2 technologies. Into the Polkadot ecosystem, and then through the transfer bridge or other methods, so that other parachains can also enjoy the Layer2 function. However, this is not the biggest advantage of Polkadot for Layer2.
As we mentioned earlier,For Layer2, Polkadot itself has a surprise。
Here we need to inoculate those who are strict with technical requirements in advance. Let’s set aside a little prejudice and understand the definition of Layer 2 in a broad sense. Layer 2 technology is actually to transfer assets to another place first ( Layer2), and then send the data back after processing to achieve some functions that cannot be realized on Layer1 (not just expansion).
Well, if we take a closer look at the technical implementation of Layer 2 and the logic of Polkadot's transfer bridge, we will find that the two are similar in some respects.
Take the BTC transfer bridge that the official and Interlay team are currently working on as an example. If BTC is connected to Polkadot through the transfer bridge, the PolkaBTC that comes over from the cross-chain can trade at a faster speed in the Polkadot ecosystem. The lower transaction cost realizes the performance expansion of BTC. On the other hand, through the cross-chain interaction between PolkaBTC and many Polkadot ecological parallel chains that support smart contracts, it is possible to give BTC the functional expansion of smart contracts. Yet?
In this way, we can understand that,If a certain chain is connected to the Polkadot ecology with a transfer bridge, it is equivalent to the entire Polkadot ecology can be regarded as the Layer 2 of this chain. (Note that Layer2 here refers to the entire Polkadot ecology, which does not conflict with what we mentioned in previous articles that the Polkadot relay chain is Layer0 and the parachain is Layer1.)
What can this do? For example, Polkadot has a huge ecology, and the development direction of many projects coincides with the thinking of Gavin, the founder of Polkadot.Gavin proposed that the future blockchain should be a multi-chain ecosystem, and no single chain can do everything. This means that in the future, it will not be a chain that includes all functions, but a public chain with different functions will be connected with other public chains through Polkadot, and can interoperate and complement each other. For example, in the Polkadot ecosystem, there are projects that focus on privacy computing, projects that focus on NFT protocols, and projects that focus on DeFi, and these projects can provide the Polkadot ecosystem with a module that can be accessed very easily. Other parachains have obtained functions such as privacy, some modules of DeFi, and so on.
postscript
postscript
During the most popular period of DeFi, Ethereum’s high gas fees and low throughput are still fresh in the memory of major DeFi projects. If Plan B is not considered, it will inevitably lead to the loss of users. Therefore, many DeFi projects fled to Ethereum one after another, choosing to deploy their own applications on all major public chains or transfer to Layer2 positions.
As a well-known project of Layer2, Polygon (formerly Matic) has shined in recent months,Well-known DeFi projects such as Aave, Sushiswap, Curve, and 1inch, as well as mainstream applications such as OpenSea and Decentraland, have been integrated into Polygon, so that Polygon has achieved huge growth in locked positions and transaction volume. So far, Polygon has a total lock-up volume of 4.78 billion US dollars (according to DeBank data). Although the total lock-up amount cannot accurately express the development of an ecology, it also more or less represents the trust of so many funds in Polygon.
Today, the Kusama slot auction is in full swing, and the Polkadot slot auction will be launched soon. It is optimistic that the auction will start in August. Judging from the current Kusama slot auction situation, Astar’s Shiden, which has Layer2 functions, is likely to qualify for the third Kusama slot. It is believed that a similar situation will happen in the Polkadot ecosystem.
At that time, the Polkadot ecology will soon have Layer 2 functions. For DeFi projects that want to migrate to Layer 2, there will be parachains that can be carried on Polkadot. In addition, as we mentioned at the end, Polkadot itself is a surprise for Layer2. When the auction of Polkadot slots starts, we can expect Bitcoin to enjoy this surprise after it enters the Polkadot ecosystem.The most direct manifestation is how DeFi projects will compete for the share of BTC around cross-chain BTC on Polkadot, This will be a good show of Polkadot's ecological explosion.
Thanks to ChainX, Patract Labs for supporting this article.
Therefore, we decided to establish a Polkadot ecological group, which can openly discuss all Polkadot ecological projects. Everyone can objectively share their views on each project, understand the development of each Polkadot project, and exchange information to seize opportunities together.
In view of the endless emergence of Polkadot ecological projects, but the inferior projects and scam projects are full of them, it is worthy of vigilance. On the other hand, it is difficult for groups only on the Polkadot project side to understand the whole picture of the entire ecological development of Polkadot, and miss many opportunities.
Therefore, we decided to establish a Polkadot ecological group, which can openly discuss all Polkadot ecological projects. Everyone can objectively share their views on each project, understand the development of each Polkadot project, and exchange information to seize opportunities together.
", reply "Join the group", add friends to the group.Polkadot Ecological Research Institute", reply "Join the group", add friends to the group.
