Is the data surge on the zkSync Era chain a bubble or a real ecology?

Since the zkSync Era mainnet was launched on March 24, in just three months, TVL has reached 627 million US dollars, accounting for 6.48% of the entire Layer2 sector, making it the third largest Layer2 network with a weekly growth rate of nearly 20% . At present, the number of independent addresses of zkSync Era exceeds 1 million.

It has to be said that these data have a lot to do with zkSync Era’s Token incentive expectations, so what is the current ecological development of zkSync Era? Can zkSync Era continue to maintain high popularity and high TVL growth after the expected end of Token incentives?

AboutzkSync Era****

zkSync is an Ethereum Layer 2 Rollup blockchain, which can also be seen as a Layer 2 trustless protocol that provides scalable, low-cost payments on Ethereum. zkSync uses ZK Rollup technology to solve the current congestion problem of Ethereum, that is, scalability. zkSync is a type of ZK Rollup and one of the first applications of zero-knowledge proof technology.

The congestion and high transaction fees of the Ethereum network have made people pay more attention to the Layer 2 expansion plan. On March 24 this year, zkSync officially announced that the zkSync Era network is officially open to all users. As one of the most supported projects in the encryption field, zkSync Era has also been favored by many capitals, raising more than 450 million US dollars from companies such as a16z and Dragonfly.

So among the many Layer 2s, how is zkSync Era developing and what are its advantages?

zkEVM

zkEVM can be understood as running EVM as a smart contract engine in ZK Rollup. Its goal is to fully bring the Ethereum experience to L2 without losing the performance advantages of Rollup.

Account Abstraction

Account abstraction creates a new account type that separates "transaction verification" from "transaction execution" by allowing accounts to exist as smart contracts. Let each account become a smart contract with its own logic and seamless compatibility, so as to give ordinary users a safety net without sacrificing self-sovereignty and a smoother user experience.

zkPorter

In order to ensure the availability of data, the zkRollup expansion scheme needs to publish data to the Ethereum base layer, but the block size of Ethereum limits the scalability of zkRollup, while zkPorter can use the availability of off-chain data, which is not affected by the Ethereum area. The size limit of the block chain, so as to achieve the scalability we expect.

Overall, compared to other L2 ZK projects, zkSync very much highlights the security and usability of current L2 scaling solutions. Specifically, the characteristics and advantages of zkSync are embodied in zkEVM, account abstraction, zkPorter, and Layer3 pathfinder, all of which are the future narrative themes of zkSync.

However, the problem with ZK Rollup is that the technical implementation is much more complicated than that of Optimism Rollup. Therefore, when the main network of Optimistic Rollup projects such as Arbitrum and OP goes online early to seize the opportunity in ecological construction, zkSync Era requires real investment of time and effort. Resources to overcome technical difficulties.

zkSync Era Ecological Environment

Regardless of whether it is a public chain or a Layer 2 project, ecological construction is extremely important. Arbitrum currently has a TVL of 5.85 billion US dollars, accounting for about 60% of the TVL of all Layer 2 projects. There are already more than 500 DApps on Arbitrum, especially GMX, which was launched continuously in 2021, is the native ace project of Arbitrum ecology. The rise of Arbitrum is inseparable from the development of native high-quality projects. , Arbitrum TVL remains at the top of the list.

So, what is the current ecological environment of zkSync? What is the status of the project development? Are there any projects with innovative advantages worthy of attention?

The TVL of zkSync Era rose rapidly after the launch of the mainnet, and its popularity was not at all inferior to that of Arbitrum when it was launched. There are close to 200,000 unique users within one week of the mainnet launch, and more than 1 million unique addresses have been launched for three months, and the lockup amount has reached 627 million US dollars. And since its launch in March, the zkSync Era ecosystem has also developed relatively rapidly. According to the current statistics on the zkSync official website, a total of 302 Dapps have been connected to the zkSync Era ecosystem, covering various fields such as DeFi, cross-chain bridges, and NFT.

Among the 302 Dapps currently deployed on zkSync Era, there are many well-known projects such as Uniswap, 1inch, and LayerZero, but currently only the projects marked with "Live on Era" are actually launched, and there are only 61 projects in total. And from the list of projects that have been launched, it is basically difficult to see well-known DApps. In order for zkSync Era to truly maintain its competitive advantage in the future, it still depends on its native high-quality DApps on the chain.

In addition, although the current TVL is growing rapidly, the No. 1 SyncSwap accounts for 40% of the DeFi TVL on the entire chain, and the top ten DApps account for nearly 75% of the TVL, and these DApps are mainly Dex, plus a few There are no projects with unique innovative advantages in these agreements.

Moreover, although the number of independent addresses of zkSync Era has grown very rapidly, exceeding 1 million in just three months, the number of ETH on the cross-chain bridge has also reached a new high, exceeding 530,000, but judging from the ETH balance of each address , 60.4% of the address balances are less than 0.1ETH, 29.7% of the address balances are between 0.1-1ETH, 9.5% of the address balances are between 1-10ETH, and only 0.4% of the addresses exceed 10ETH. From the balance distribution of zkSync Era independent addresses, it is not difficult to see that the vast majority of users are wool party attracted by the incentive expectation of zkSync Era tokens.

Due to the lack of star projects such as Uniswap and AAVE on zkSync Era, it is difficult to undertake the lock-up of large amounts of funds. The influx of parties brought about an explosive growth in the number of unique addresses.

At present, the projects on zkSync Era that are really worthy of participation and interaction are limited, nothing more than DEX and lending with relatively high TVL rankings. What deserves more attention at present is his Dex leader Syncswap, which currently ranks first on the Internet with a lock-up volume of 68.92 million US dollars. The point is that he has not issued coins yet.

Problems with zkSync Era

As the first zkEVM project launched on the mainnet, zkSync Era has more than 1 million independent addresses in just three months, surpassing all other mainstream Layer 2 projects, and TVL has also achieved explosive growth. Regardless of airdrop expectations, It has to be said that it also has certain stories and possibilities, but its problems are also very obvious:

  1. The project is still in its early stages. Although there are many cooperation projects announced on the official website, there are no high-quality projects that have actually been launched. Even SyncSwap still has a long way to go compared with GMX on Arbitrum, and the original project has been launched The quantity is small and the quality is uneven, making it difficult to accumulate TVL quickly.

  2. Dex and lending are the top-ranked native projects that have been launched. Compared with existing projects in the market, these protocols do not have any unique competitive advantages. For users, apart from the attractiveness of token airdrops In addition, there are not many other reasons that must be used. When the expectations disappear or are fulfilled, how to continue to maintain the growth of TVL is a problem that needs to be considered.

  3. Compared with Optimistic Rollup projects such as Arbitrum and Optimism, the ZK Rollup project is much more difficult in terms of technical development, especially the compatibility between DApps on zkSync Era and the Ethereum mainnet is a major challenge. However, with the advancement of zkEVM technology, this problem may gradually be resolved.

zkSync Era Opportunity and Future*

The Layer2 ZK market is still in a stage of fierce competition in general. In addition to zkSync, StarkWare, Scroll, Ploygon EVM, Aztec, etc. all belong to this track. Although ZK Rollups currently has technical difficulties, when running on a large scale, encryption The ecosystem and even the whole world will gain substantial progress based on this technology.

Faced with the Ethereum network’s trilemma, while many projects are attempting to bring scalability to the chain, each solution and technology has its own unique tradeoffs and use cases. zkSync Era chose to maintain source code compatibility (Solidity and Vyper), which brings additional security benefits. When the project is deployed on L2, the EVM project does not require any code changes, reducing the risk of vulnerabilities and attacks.

At present, many projects on the zkSync network are still in the early stage, the project quality is low, and there is no high APY income support, it is difficult to retain user funds. In the future, zkSync will continue to expand the application ecosystem, encourage more project parties and developers to join zkSync, and further promote the development and application of zkSync.

summary

With the continuous development of Ethereum technology, the competition of zkEVM is becoming more and more fierce. As one of the most anticipated and promising public chains in the ZK track, how can zkSync Era not let its ecology be submerged in the rug project? Developing and supporting more background and powerful projects is something that zkSync Era and various new public chains need to consider.

zkSync Era has demonstrated extremely high performance and efficiency in the past period of time. It will take a lot of time for zkSync Era to truly flourish. With the continuous expansion of the zkSync ecosystem, we expect zkSync 3.0 to bring more Many surprises.

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