Written by Kyrian Alex

Translation: Plain Language Blockchain

For a long time, the need for scaling solutions in blockchain technology has been a controversial topic. As we all know, as blockchain networks expand, transactions per second (TPS) become a key issue. Currently, major blockchains like Bitcoin and Ethereum have insufficient capacity to handle the required transaction volume for widespread adoption.

For example, Bitcoin processes about 7 transactions per second, while Ethereum processes about 15. In contrast, Visa averages about 1,700 transactions per second. Without scaling solutions, blockchain cannot compete with traditional financial systems and achieve widespread adoption.

So, what about the actual cost of the transaction?

The same is true in practice... As more and more people use blockchain at the same time, transaction fees become very high, and peak times can hinder users and make microtransactions impractical. For example, during the DeFi boom in 2020 and 2021, Ethereum's Gas fees soared, making even small transactions extremely expensive.

So, how do we solve this problem? We solve this problem by introducing an extension solution.

An expansion solution is a technology designed to increase the capacity and efficiency of blockchain networks to handle higher transaction volumes. The main goal of the expansion solution is to increase the network's throughput, i.e. transactions per second (TPS), while maintaining or improving security, decentralization, and cost-effectiveness.

Scalable solutions are crucial to reducing transaction costs, enabling blockchain technology to be more widely adopted for everyday use. Slow transaction times and high fees will decrease user experience, hinder new user adoption, and limit the availability of decentralized applications (DApps).

In order to attract and retain users, the blockchain network must provide seamless, fast, and cost-effective transactions, which can be achieved through effective scaling solutions.

Today, we will explore how different networks address these challenges, specifically comparing zk Rollups on Ethereum and zk Compression on Solana. Both technologies aim to improve scalability, but they achieve this goal in different ways, reflecting the unique design principles and priorities of their respective ecosystems.

1. What is ZK Rollups?

ZK Rollups is a type of L2 scaling solution that increases the scalability of the blockchain by migrating computation and state off-chain, while batching transaction data and storing it on-chain.

They use cryptographic proofs called zero-knowledge proofs to demonstrate the validity of these packaged transactions without revealing actual data. This way, while keeping the Ethereum mainnet secure, faster and cheaper transactions can be realized on the sidechain.

How do they work?

A sequencer batch processes transactions off-chain.

The Sequencer generates zk-SNARK (Zero-Knowledge Succinct Non-Interactive Argument of Knowledge) proofs, which are compact cryptographic proofs that verify the validity of transactions without revealing all the details.

Proofs and transaction data are submitted to the Ethereum mainnet, where anyone can validate the proof on-chain to ensure the validity of the transactions. In case of disputes, anyone can submit the original transaction data for on-chain settlement, leveraging the robust security of Ethereum. Rollup involves an encryption proof, specifically a zero-knowledge proof, to verify the correctness of bundled transactions. The Ethereum network only needs to validate this proof, rather than every transaction, significantly reducing the computational load. Transactions are grouped off-chain into Rollup, generating zero-knowledge proofs to confirm the validity of aggregated transactions. The proofs and minimal digest data are submitted to the Ethereum mainnet for validation. Upon successful validation, the state on the Ethereum mainnet will be updated to reflect the Rollup transactions.

2. What is ZK Compression?

ZK Compression is a technology used on the Solana blockchain to reduce data storage costs, it only stores the compressed data 'fingerprint' (hash) on-chain while maintaining the privacy of the data.

The "ZK" in ZK Compression stands for zero-knowledge, indicating that the privacy of compressed data is protected. This method significantly reduces the amount of data that needs to be stored on-chain, thereby reducing developers' storage costs.

How does ZK Compression work to its full potential?

ZK Compression reduces the cost of storing and maintaining data (such as account balances and smart contract storage) on Solana blockchain by leveraging Zero Knowledge (ZK) technology.

Here is a detailed breakdown of how it works:

The data of each account is compressed into a unique hash value. This hash value includes not only the account information, but also its position in the state tree, ensuring its uniqueness. This hash value is stored in the leaf node of the state tree.

The state tree is a data structure similar to a Merkle tree, where each node is the hash of its child nodes. The state tree summarizes all account information and data, compressing it into a top-level hash value called the state root.

The state root is the top-level hash value of the state tree, stored on the blockchain. This root serves as a fingerprint of the entire state tree, ensuring the integrity and completeness of all data in the tree.

Detailed account data is not directly stored on the blockchain. Instead, it is stored as call data in the cheaper Solana ledger space. Only the state root and some basic metadata are stored on-chain, which significantly reduces storage costs while maintaining data security.

To ensure the integrity and authenticity of the compressed data, ZK Compression uses Zero-Knowledge Proofs (ZK-proofs). These proofs verify the accuracy and completeness of the data without revealing its actual content, ensuring that even compressed data can remain secure and verifiable.

Please note that ZK Compression is not an L2 solution, but an upgrade aimed at improving the efficiency of data storage on Solana.

ZK Compression is different from L2 rollup solutions, because in ZK Compression, transaction execution and state storage occur directly on the first layer (L1) on-chain, i.e. on Solana.

The key difference lies in the location of execution and state management. In zk Rollups, these processes occur on an auxiliary on-chain, which regularly sends commitments and proofs to the main L1 chain. In contrast, ZK Compression keeps all execution and state on Solana itself, rather than on a separate chain.

This fundamental difference means that while ZK Rollups offload some processes to the second layer to enhance scalability, ZK Compression optimizes data storage directly on the main blockchain without creating separate layers for execution.

3. Difference Between the Two

The key difference between zk Rollups and zk Compression on Ethereum and Solana fundamentally lies in their methods of enhancing blockchain scalability and optimizing data storage:

1. Execution and Status Management:

zk Rollups: Transaction execution and state storage occur on an auxiliary chain, separate from the Ethereum mainnet. The auxiliary chain regularly sends commitments and proofs to the Ethereum mainnet.

zk Compression: All transaction execution and state storage are directly performed on the first layer (L1) on-chain, that is, on the Solana chain. There is no separate auxiliary chain involved here.

2）on-chain data processing：

zk Rollups: Only submit encrypted proofs and minimal digest data to the Ethereum mainnet for verification. This method minimizes the computational load on the mainnet as much as possible.

zk Compression: The 'fingerprint' (hash) of compressed data and the corresponding ZK proof stored only on the Solana blockchain. This significantly reduces the amount of on-chain storage and lowers storage costs.

3. Privacy and Integrity:

zk Rollups: Use zk-SNARK (Zero-Knowledge Succinct Non-Interactive Argument of Knowledge) proofs to ensure the validity of transactions without revealing detailed transaction data. This method ensures privacy and security of the Ethereum Mainnet.

zk Compression: combines data compression and ZK proof to optimize blockchain storage, while mathematically proving the integrity of compressed data. It ensures that the decompressed data matches the original data while not revealing the content, thereby protecting privacy.

4. Nature of the solution:

zk Rollups: considered as a Layer 2 (L2) scaling solution, as they move transaction execution and state management to a secondary chain, enhancing scalability and dropping the cost of the Mainnet.

zk Compression: Not classified as a Layer 2 rolling solution, but rather an upgrade that improves data storage efficiency directly on Solana's Layer 1 chain. It optimizes storage costs without the need to introduce a separate execution tier.

4. Conclusion

In conclusion, both of these extension methods emphasize the importance of balancing the sustainability of the network while maintaining the core principles of the blockchain network in order to ensure its continuous growth.

In this regard, Solana has made significant achievements in adopting advanced scaling solutions, paving the way for widespread adoption and innovation in the blockchain industry.