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Ethereum Co-Founder Vitalik Proposes Solution to Link Certain Layer-two Scaling Projects

  • Posted On - 2021-03-03 13:16:41

In a working attempt to put away escalating transaction fees alongside creating a unified ecosystem, Ethereum co-founder Vitalik Buterin has proposed a solution for several types of cross-rollup scaling.

The proposal remarks how two protocols using rollups are going to communicate with one another while maintaining interconnectivity and composability.

Rollups are layer-two solutions essentially called smart contract networks that process and store transaction data off the main chain. However, there are numbers of different rollup types, with each of them using unique smart contracts such as optimistic and zero-knowledge.

As a number of DeFi projects have deployed layer-two rollups, such as Loopring and Synthetix, the particulars of the various rollups mean projects are not able to communicate to one another directly on layer-two.

Buterin’s proposal defines that one rollup can process simple transactions whereas the other has full smart contract support. However, there are already several proposals for transfers between two smart contract enabled protocols using rollups.

While explaining how proposal works, Buterin provides the example of a hypothetical exchange intermediary he called ‘Ivan’ — where Ivan has an account ‘IVAN_A’ on rollup A that he fully controls, and also has some funds already deposited in a smart contract ‘IVAN_B’ on rollup B.

The smart contract will be programmed to accept “memos” that include additional data from anyone sending it to secure any future transactions. These transactions create a connecting layer to keep deposits in all these isolated contracts, allowing rollup A to send to rollup B via this layer.

Buterin defined that the behavior would work as follows;

“Alice sends a transaction to IVAN_A with N coins and a memo ALICE_B. Ivan sends a transaction sending TRADE_VALUE * (1 - fee) coins through IVAN_B to ALICE_B”

Further he added that the worst-case behavior takes place while Ivan does not send coins to ALICE_B as he is expected to.

Addressing the “worst-case” scenario that could come up as a consequence of using the proposed situation, Buterin emphasized that Alice would still be able to wait until the transaction on rollup A confirms, find some alternate route to getting coins on rollup B to pay fees, and then simply claim the funds herself.

Addressing to this proposal, Alon Muroch marked out that it worked in a similar method the way banks clear transactions:

“That’s very interesting, similar to how banks clear transactions between themselves. Batching assets into separate “accounts” could have limitations, a solution could be just big pools on either ends and fees split pro-rata.”