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The Bankless Guide to zkSync

Updated September 2023
Bankless Bankless Mar 24, 20236 min read
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The Bankless Guide to zkSync

zkSync is a layer-two (L2) scaling solution developed by Matter Labs, a blockchain technology company founded in 2018. The solution was created to address the scalability issues of the Ethereum network, which during periods of high activity faces slow transaction times and high fees.

The development of zkSync began in 2019, and zkSync 1.0 was released to the public in June 2020. The tech is based on zero-knowledge proofs, a cryptographic technique that enables transactions to be verified without revealing any information about the transaction itself. This makes it possible for zkSync to process transactions faster and more cost-effectively than the Ethereum network.

Since its release, zkSync has continued to evolve, with new optimizations being rolled out over time. In October 2022, Matter Labs released the alpha version of zkSync 2.0, the first big step toward the team’s release of its zkEVM, i.e. a ZK rollup compatible with the Ethereum Virtual Machine.

Then in February 2023, Matter Labs renamed zkSync 2.0 to “zkSync Era,” rebranding zkSync 1.0 to “zkSync Lite” in the process, and began the Fair Onboarding period of its Era alpha so that registered projects could start launching on the L2. Finally on March 24, 2023, the zkSync Era mainnet alpha was launched, allowing users to experience a live zkEVM in production for the first time.

What is zkSync

As mentioned above, there will be two distinct zkSync L2s going forward: zkSync Lite and zkSync Era.

Although zkSync Lite is not the ultimate solution for the zkSync ecosystem, it is a fully functional ZK rollup that currently ranks as the seventh-largest L2 scaling solution in the Ethereum ecosystem, according to L2BEAT. While it will stay in operation going forward, its future popularity remains to be seen, particularly with the release of zkSync Era, which will offer more advanced smart contract capabilities.

via L2BEAT

As for zkSync Era, it’s a zkEVM so it’s designed to offer Ethereum-like UX for developers and users but with the major additional benefits of instant transaction confirmations and extremely-low transaction fees in contrast. Unlike regular ZK rollups which can only facilitate simple transactions like transfers, swaps, and mints, zkSync Era’s compatibility with the EVM means it can facilitate more advanced, arbitrary smart contract capabilities.

Over time, zkSync Era is set to evolve further. For example, the L2 is currently centralized in how it is maintained, but it’s set to be “transitioned to a decentralized system shortly” the zkSync team has said. Additionally, in the future the L2 will be extended by zkPorter, a novel volition system that can facilitate up to ~20,000 transactions per second (TPS) and will offer users the ability to switch between a ZK rollup mode and a validium mode at will.

via zkSync

Notably, the zkSync team is also innovating on Hyperchains, which will allow third-party projects to deploy their own zkEVM L2s and L3s using the zkSync tech stack.


The pulse of zkSync

As of this guide’s latest update (Septebmer 2023), zkSync Era boasted $415M in total value locked (TVL), making it the 4th-largest L2 at the time. As for zkSync Lite, its $82M TVL currently makes it the 10th-largest L2.

via L2BEAT

The zkSync token?

via zkSync

zkSync hasn’t launched a native token yet, but the L2’s roadmap explicitly mentions tokenomics so it’s clear such a token is forthcoming. Plus, we know the zkSync team is planning to decentralize the operation of its L2 going forward, and a token is the tool of choice for doing so in the cryptoeconomy.

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What you need to use zkSync

  1. 👛 A wallet — you will need a wallet that has added support for zkSync to create an Ethereum address; the most popular and widely used zkSync wallet to date is Argent
  2. 🪙 Starter ETH — like you need ETH for gas on Ethereum, you need ETH to pay for transactions on zkSync; if you have ETH on Ethereum you can then bridge some over to use on zkSync

How to bridge to zkSync

If you want to get started with zkSync Lite, you can link your Ethereum wallet via Argent or WalletConnect and then deposit over ETH or supported ERC20 tokens to get started. Learn more in the zkSync Lite docs.

As for the native bridge of zkSync Era, it’s now live and operational at bridge.zksync.io. Before the L2’s mainnet launch on March 24, 2023, the bridge was only usable by developers, but now anyone can bridge funds over and experience zkSync Era apps. Just remember the L2’s in an alpha state right now, so only bridge over funds that you’re willing to experiment with and potentially lose.


What to do on zkSync

The best way to find which projects are currently live on zkSync Era and zkSync Lite is the zkSync Ecosystem hub, which makes it simple to find which apps are live on which of the zkSync L2s at any given time. However, since the zkSync Era launch is so new, there are not many apps live on the L2 yet except for bridges. If you want to dabble on zkSync right now, you might consider some of the DeFi options currently available on zkSync Lite. These opportunities include:

1. Trade tokens on ZigZag

Argent allows people to simply trade top tokens through an integration with ZigZag, a decentralized exchange (DEX) on zkSync Lite.

When you’re in the zkSync section of the Argent wallet, click on the “Invest” tab and then the “Trade Crypto” button to begin exploring the available token pair options. Supported tokens include DeFi mainstays like AAVE and CRV, NFT plays like APE, and indexes like DPI, BED, and GMI.

2. Lend tokens on Aave

Aave is DeFi’s leading lending protocol, but its transaction fees on the Ethereum L1 can be expensive. To that end, Argent wallet offers the ability to inexpensively lend the DAI or USDC stablecoins to Aave on zkSync.

To get started here, click on the “Invest” tab in your Argent wallet and then click on the DAI or USDC buttons in the “Earn on other tokens” section of the UI. This will bring you to another interface where you can lend you stables in order to start earning yield from interest payments.

3. Stake ETH on Lido

Lido is a liquid staking protocol that makes it simple to earn by depositing crypto to secure blockchains like Ethereum, and Argent supports ETH staking via Lido on zkSync Lite.

If you want to dive in here, flick over to the “Invest” tab in the zkSync section of your Argent wallet and press the ETH option in the “Earn on tokens you hold” section of the app. Now you’d click on Lido’s “Staking” option, which was providing 4.65% variable APY at the time of this post’s writing, to proceed with a deposit.


Additional zkSync apps

Curious about what other applications are available on zkSync Lite immediately following the zkSync Era public launch? Here are a few you can start exploring today:

  1. 🌱 Gitcoin — Public goods donations
  2. 💵 Yearn Vaults — Yield aggregation
  3. 🪙 zkSync Checkout — L2 payments

Additional zkSync resources

If you're interested in learning more about zkSync and enhancing your comprehension of this L2 scaling solution, there are plenty of informative resources at your disposal. Here are some you can get started with

  1. 📜 zkSync Era docs
  2. 📜 zkSync Lite docs
  3. 🕳️ zkSync Era Ecosystem apps
  4. 🔍 zkSync Lite block explorer
  5. 🔍 zkSync Era block explorer

Zooming out

The zkSync ecosystem is rising to meet the occasion of Ethereum’s scalability issues. Its progress on its zkEVM L2 is combining the inexpensive, rapid, and secure UX of a ZK rollup with the general programmability made possible by Ethereum smart contracts. As such, zkSync Era is poised to become a popular scaling solution in the cryptoeconomy going forward.

Moreover, as zkSync Era continues to evolve and add new enhancements like zkPorter, it has the potential to become a truly dominant force in the L2 scaling world. Whether you’re a developer or a user, diving into zkSync today will undoubtedly put you on the frontier of Ethereum’s future.

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