Hello to everyone reading this! I have once again participated in this week's homework. Through this lecture, I learned a lot about Sidechains and ZK-Rollups.
Question 1: Explain in detail the Sidechains with the use of ZK-Rollups.
Before explaining Sidechains with the use of ZK-Rollups, I will explain in detail what Sidechains are.
Sidechain is a new mechanism that is working on making Blockchains more adaptable and coherent. Sidechains are attached to Blockchains and run equidistant to that Blockchain.
Sidechains permit the data stored in these Blockchains to safely be used in another Blockchain and when needed the data can safely move back into the initial blockchain. Sidechains also provide multiple advantages and one of them is the speed. Just by using a different lane and a different mechanism, the job gets done faster.
It should be noted that Sidechains are not independent as they rely on the main Blockchain. Data can easily be transferred between both the Sidechain and the Blockchain after the two are connected.
The process to use your coins or data in the Sidechain is simple and straightforward. The user must transfer their data or coins to an output address where they can be safe and not be used. A confirmation is sent over to the chains after the transaction of the data has been successfully made. The coins or data are then transferred to the Sidechain where the coins or data can be safely used.
Now I will move on to explain Sidechains with the use of ZK-Rollups.
SIDECHAINS WITH THE USE OF ZK-ROLLUPS:
ZK-Rollups are an Ethereum Sidechain recognized with a Layer 2 Construction. The mission of this architecture is to improve scalability in Blockchain. To enhance the functioning of scalability, ZK-Rollups incorporate hundreds of transactions into one transaction. The transactions made through ZK-Rollups are decoded and confirmed by Smart Contracts.
Unlike other Sidechains, the validity of the block is introduced and recorded by ZK-Rollups. The approach they use lessens the burden on storage and the computing services by decreasing the amount of data preserved in a transaction. Therefore, no knowledge of the transaction is provided to the users which is the reason why ZK stands for "ZERO KNOWLEDGE".
The ZK-Rollup is made up of two types of users; the transactors and the relayers. The transactors are users who generate their transactions and transmit it to the network. The data consists of information regarding the sender and receiver address, the transaction amount, a nonce and the network fee. An indexed version of the address will be initiated. A deposit or withdrawal is created based on the value of the transaction when the transaction value is higher than or less than zero. The data from the transaction is stored in two Merkle trees which are generated from the transaction. The amount is stored in one tree whereas the address is stored in the other.
Relayers assemble a large number of transactions and create a Roll-up. They also generate the Snark Proof which is a hash that compares the wallet values before and after the transactions and informs the mainnet of any notable changes in a verifiable hash. A user can become a relayer if they have staked the requisite bond in the smart contract. This motivates the relayers to avoid tinkering with or hampering a rollup.
Users using decentralized applications that run on ZK-Rollup techniques are imposed with cheaper fees. Users are also provided with faster transaction speed in a decentralized structure. Due to the setback of SNARK proof, there has been a growth in the latency of block confirmations.
ADVANTAGES OF ZK-ROLLUP:
- It is faster than both Plasma Rollup and Optimistic Rollup.
- Transaction fees charged per user transfer is minimized.
- No demand for Fraud Game verification.
- Fewer data is used for each transfer which improves scalability.
DISADVANTAGES OF ZK-ROLLUP:
- Since it is troublesome to figure zero knowledge, hence, data optimization is essential for scalability.
- Centralization is encouraged at the primary stage.
- Security level of ZK-Rollup is not established.
- Quantum computing makes it easy for the Blockchain to be hacked.
Before ending my discussion regarding this topic, I would like to share a project that is currently using ZK-Rollups.
Numio is the world's first non-custodial and Ethereum generated wallet that runs on ZK-Rollups. Numio has high security and guarantees its users that their identities are safe in this network. Using ZK-Rollups, Numio provides its users faster transactions at much lower prices.
Question 2: Explain the Liquid Network side chain.
Liquid Network is a Bitcoin Sidechain network that expedites immediate and privileged transactions. It assists the transactions that are being made into and out of the main chain. It permits Bitcoin to flow in between the liquid and also the Bitcoin network escorted by a two-way peg.
Liquid Bitcoin (L-BTC) is a kind of asset on the Liquid Sidechain and is supported by the liquid network. Liquid Bitcoin has the same value as the actual Bitcoin. Liquid Bitcoin can not be swapped in any other network except liquid networks. Coins are transacted from the Bitcoin Blockchain to the Liquid network through peg-in.
Blockstream generated this project to refine and resolve the process for digital assets. All transactions go through the process of getting verified by the Bitcoin network. Blockstream connects with multiple exchanges and some of them are shown in the screenshot below.
The vision of liquid networks is to bid financial institutions to accompany them in sorting out huge transactions. Liquid network provides its users with the utmost. The transactions are rapid and guarantee complete security. Some projects that use liquid networks are Prytco, Bitfinex and Huobi.
WORKING BEHIND LIQUID NETWORKS:
It was mentioned before that the user must transfer their data or coins to an output address where they can be secure and not be spent. A confirmation is sent over to the chains after the transaction has been made. Once the confirmation is given, the user can employ the coins.
When the opposite is being done i.e. the coins are being sent to the parent chain, two confirmations are to be sent before the coins can be utilized.
FEATURES OF LIQUID NETWORK:
Fast Transactions: Liquid blocks are added every minute. This allows users to transfer their coins in the chains without having the user spend long time waiting.
Confidential Transactions: This feature permits only the users involved in the transaction to see the details regarding the transaction. The amount of the transaction is kept hidden from any external party. Users who want to keep their transaction details to themselves find this feature suitable to use.
Creating New Assets: This feature allows the forming of new assets such as reward points, security tokens, collectibles and altcoins etc. The network does not verify these newly made assets.
USES OF LIQUID NETWORK:
Liquid Network has many uses and some of them are given below:
When it comes to confidentiality, Liquid network provides its users with privacy by sharing the transaction details only with the parties involved.
It is used to create new digital assets so any user who is interested in making new assets will prefer this option.
Liquid network is used to process faster block transactions. These transactions are sped up per minute due to which the speed of the transaction is improved.
Liquid network is used to handle assets for more than one transaction.
Question 3: Describe the steps to connect the Metamask wallet and the Polygon network wallet. Show screenshots.
These are steps to connect the Metamask wallet and the polygon network wallet. I used my phone to do these steps but if you want to use a desktop, the same steps will apply.
- Open your Metamask app or website and click on the three lines in top left corner.
- Click on 'settings'.
- Click on 'networks'.
- Once this page shows up, click on 'add network'.
- Fill in all the boxes with the details they have asked for and click on 'add'. Here is mine:
Network Name: Polygon
RPC Url: https://polygon-rpc.com/
Chain ID: 137
Block Explorer URL: https://polygonscan.com/
- After ending the process, go back to the networks. This time you will see Polygon added as a network.
Now to connect the Polygon wallet to the Metamask, open the Polygon Network Wallet.
- On the homepage, click on the three lines on the top right corner of the page.
- Click on 'Use Polygon'.
- A dropbox will open. Click on 'Polygon Wallet'.
- This page will be shown on your screen. Click on 'Polygon Wallet'.
- On your screen now, click on 'WalletConnect'.
- When this pop-up is shown below, click on 'Connect'.
- Click on 'Sign' to connect your wallets. Automatically, the Metamask application will open.
- Click on the three lines on the top left corner of the page.
- Click on 'Browser'.
- On the browser page, in the top right corner it is shown that the wallet has been connected.
Question 4: According to the polygonscan block explorer, when will the block 25,000,000 be generated? Show screenshot. Explore the 12,000,000 block, at that time, what was the price of the Matic? Show screenshots.
First I will perform the task to show when block 25,000,000 will be generated. Go to the website of PolygonScan.
- This is how the homepage of the website looks like. Click on the search bar.
- Type 25,000,000 in the search bar.
- This is what showed up on my screen.
Estimated Target Date: March 02, 2022, Wednesday
Time: 00:24:17 GMT+0500 (Pakistan Standard Time)
Now moving on to the task of searching the price of block 12,000,000.
- Go back to the search bar of the website but this time write 12,000,000 in the search bar.
- This is the page that shows up with all the information provided.
Timestamp of Block: 228 day, 22 hours ago
Date: March 14, 2021
Time: 09:35:48 AM +UTC
Price of MATIC: $0.38
Sidechain is a mechanism that is working to make Blockchains more adaptable. Sidechains are connected to Blockchains and runs parallel to that Blockchain. ZK-Rollups are an Ethereum Sidechain working to improve scalability in Blockchain.
Through this lecture, I learned not only about Sidechains but also about Sidechains in detail and undoubtedly learned a lot about this topic. Researching about this topic was very fun as I found a lot of amazing information. Yet again, I enjoyed writing this homework. Thanking the professor @pelon53 for sharing such a great topic with us.
Thank you for reading this post!