Investor Day, Fireside Chat, Interview
Scaling Up Blockchains with Zero-Knowledge Proofs
- A16z is leading Matterlabs' Series B round, recognizing the project as a top contender in the blockchain space.
- Blockchain computing is predicted to be the next major wave in history, with the potential to boost global GDP by five to ten percent and accelerate human progress similarly to the impact of shipping containers.
- Future blockchains are expected to enable decentralized social networks and crypto-enabled games with economies larger than centralized equivalents, removing data monopolies and third-party trust issues.
- Matterlabs identifies scalability as a core bottleneck, noting Ethereum currently processes approximately 14 transactions per second, which is insufficient for billions of users.
- Matterlabs aims to solve scalability using zero-knowledge proofs, with ZK-Sync Version 2.0 targeting full EVM compatibility and the ability to execute arbitrary contracts.
- ZK-Sync currently offers bounded scalability with a factor of roughly 50, resulting in transaction costs approximately 50 times lower than Layer 1 Ethereum; for example, a $1,000 Ethereum interaction would cost around $20 on ZK-Sync.
- ZK-Porter is designed for unbounded scalability by moving data availability off-chain, contrasting with ZK-Sync's on-chain data approach, and is intended for lower-value funds while ZK-Sync handles high-value assets.
- The immediate roadmap involves opening the ZK-EVM testnet to the public to ensure robustness, followed by launching the protocol on the mainnet.
- The protocol has already processed over four million transactions, with 99% of Gitcoin grant rounds conducted on ZK-Sync.
- Security for ZK-Sync is derived directly from Ethereum mainnet, while ZK-Porter relies on a "honest majority" or "rational majority" assumption among guardians, introducing specific security trade-offs.
- Confidence in security is expected to grow after a protocol has been time-tested for six months to a year.
- Technical advancements include zero-knowledge proof algorithms trending toward greater efficiency, the development of specialized hardware, and the evolution of programming languages to support ZK implementation.
- Matterlabs pivoted from a custom language (Zinc) to EVM compatibility to facilitate ecosystem adoption, viewing Solidity as the lingua franca of Web3.
- Most existing Ethereum DeFi protocols are expected to launch on ZK-Sync from the start, and multi-chain applications will necessarily include ZK-Sync.
- New applications, such as social networks, are anticipated to emerge once the user base expands and transaction costs decrease further.
- Increasing computing power by a factor of 10 or speed by a factor of 50 is expected to unlock a significant volume of previously impossible applications.
- Future blockchains are predicted to make human interactions more seamless by enabling direct value exchange without intermediaries.
- The vision includes creating an unstoppable network accessible globally regardless of local government status, aiming to preserve decentralization and prevent single points of control.