Research

2024 Plot Twist: ZK Stack and Layer 3

Quick Take 💨

  • AppChains: Easier Dev, Better UX, More Adopters. Build Chains Easier with RaaS & Rollup SDKs
  • L2 Showdown: Arbitrum, Optimism, zkSync battle for supremacy. zkSync rising with unique features.
  • zkSync Ecosystem Booms: Strong tech, growing dApps like Syncswap, Mute & Maverick. Private appchain GRVT brings CEX-like DEX
  • Token Expectation: zkSync & GRVT launches hype up ecosystems. GRVT’s hybrid exchange model, CEX meets DeFi, is hot.
  • ZK Tech is the Future: Scales like crazy, solves dev problems. GRVT shows the way for DEX evolution.

Read the full version here: https://xangle.io/en/research/detail/1818

Layer 2 Journey in 2023

Growth of Layer 2

Layer 2 ecosystem is the main focus of the crypto market in 2023. Rollup projects drive L2 growth with $21.16 billion TVL and 80% market share.

AppChains, so called Layer 3 for Wider Adoption

AppChains aim to ease development, improve user experience and overcome low adoption for the crypto industry in the next phase.

Here comes the RaaS and Rollup SDK for the easy AppChain Development

RaaS offers a comprehensive development environment for building AppChains. Apart from this the Rollup SDK simplifies AppChain creation with 10-minute no-code deployment.

The Benefits of AppChains

  • Developers can customize chains with more efficiency.
  • Increase productivity and user experience innovation.
  • Construct other dApps and infrastructure seamlessly.

Overall: The shift towards L3 technologies like AppChains and RaaS promises smoother development and wider adoption in the crypto industry.

Layer 2 and Layer 3 Growth in 2024

L2 rollups are actively driving L3 development, anticipating an impressively growing appchain landscape in 2024.

Leading L2 players like Arbitrum, Optimism, and zkSync offer SDKs and infrastructure for L3 creation.

Individual Layer 2 Approaches

  • Arbitrum Orbit: Builds custom chains within the Arbitrum ecosystem, leveraging existing infrastructure.
  • OP Stack: Creates a network of L2 chains on the Optimism mainnet, emphasizing shared security and governance.
  • zkSync: Focuses on zkRollups for enhanced security and instant finality. Its ZK Stack framework allows building both L2 and L3 chains (including Hyperchains for independent appchains with direct Ethereum connection).

Layer 2 Competition and Future

  • Optimism and Arbitrum dominate now, but zkSync is expected to rise in 2024.
  • Each L2 solution offers unique features and caters to different developer needs.

Overall:

L2 technologies are fueling the next stage of crypto innovation with appchains and L3 ecosystems.

Developers have diverse L2 and L3 building options depending on their goals and desired security/customization levels.

zkSync Ecosystem and its potential

  • zkSync is a promising project with strong technical specs and infrastructure, despite its current small TVL.
  • Syncswap, Mute, and Maverick Protocol are prominent dApps on zkSync, offering DeFi and exchange services.

Introducing GRVT: A ZK Stack Hybrid Exchange (HEX) on Hyperchain:

  • GRVT is the first private appchain on ZK Stack, building a self-custodial CEX with CEX-level trading experience.
  • It aims to overcome limitations of both DEXs (UX, TPS, liquidity) and CEXs (security, counterparty risk) through zk technology and Hyperchain’s scalability.

GRVT’s Characteristic Features:

  • Scalability: Hyperchain enables high TPS (600,000) and low latency with private app chain and interoperable Hyperchains.
  • Security: zk encryption, validium technology, and off-chain order book protect user privacy and prevent attacks.
  • Hybrid Exchange Features: CEX-like interfaces, diverse trading products (options, futures), margin systems, and RFQ support.
  • Risk Minimization: Strong team, zk-based AML/KYC, permission-based access control, and oracle management practices.

Anticipation for zkSync & GRVT tokens

  • Excitement is building for the launch of both the zkSync token and GRVT’s own token.
  • Historical examples suggest native tokens can boost ecosystem growth through airdrops and network effects.
  • zkSync’s anticipated token launch is expected to create significant hype, similar to Arbitrum and Optimism.

Token Synergy between GRVT and zkSync

  • DEXs like GRVT will benefit from increased liquidity driven by the zkSync token and its users.
  • GRVT plans its own token launch after zkSync’s, further building momentum within the ecosystem.

Overall:

  • GRVT is a novel exchange leveraging ZK Stack technology to achieve CEX-level performance and DeFi benefits in a self-custodial environment.
  • Its focus on scalability, security, hybrid features, and risk management aims to address key challenges in both traditional and on-chain exchanges.
  • The upcoming token launches in the zkSync ecosystem, particularly for zkSync and GRVT, are expected to drive significant growth and attract new users through rewards.

Closing Thoughts of the research:

  1. Shifting Focus: From L3 framework development to actual projects utilizing these frameworks.
  2. Diverse L3 Landscape: Each L2 chain (e.g., Arbitrum, Optimism) boasts unique strengths and fosters distinct projects (e.g., Syndr, Base).
  3. Zk Technology Rising: Expected to be the next big thing in scaling with solutions for service building limitations.
  4. GRVT as a Case Study: Combining zk with a hybrid exchange model targeting both retail and institutional investors. This innovative approach could potentially reshape the DEX landscape.
  5. Intriguing Outlook: The first half of 2024 will showcase whether zk-based L3 projects like GRVT can mature and pave the way for wider adoption.

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