zk-Rollup

Polygon, Immutable zkEVM to tackle ‘huge incumbents exploiting players’

Web3 gaming developers will be able to build on a new zero-knowledge Ethereum Virtual Machine that aims to increase ownership rights for players and take on the big gaming corporations.

Gaming developers are getting a new platform on which to build Web3 games, with a tie-up between Polygon Labs and Immutable set to launch a new zero-knowledge Ethereum Virtual Machine (zkEVM).

The partnership sees the two Ethereum layer-2 firms create an “Immutable zkEVM” — a Polygon (MATIC)-powered zkEVM fully supported on Immutable’s Web3 game development platform.

Scheduled for a March 27 mainnet beta launch, Polygon’s zkEVM enables the validation of mass amounts of transaction data by bundling them up into one transaction that’s then confirmed on the Ethereum network. The same technology will feature on Immutable’s zkEVM solution.

Polygon Labs president, Ryan Wyatt, told Cointelegraph that the technology would allow game developers to focus on building a “great game” rather than needing to divert resources toward building the game on-chain.

“This massively simplifies the choices for developers and helps us focus on what really matters — which is taking on the huge incumbents who are exploiting players on a daily basis.”

In a separate statement, Immutable co-founder and president Robbie Ferguson stated that billions of dollars worth of in-game skins is sold each year with no rights to players.

“We’re changing that so players are in control, and ownership is the expectation,” he said.

Wyatt told Cointelegraph that the partnership came together despite Immutable and Polygon Labs being in competition, adding that the technology “really quickly aligned us” and it was “good for gamers and game developers.”

A ChainPlay survey of blockchain gamers last August revealed that 81% are prioritizing a positive and fun in-game experience after 89% reported losing money in the crypto winter of 2022.

Wyatt said that currently, devs are too focused on how to “actually build a game on-chain,” which pulls focus away from “making a really great game.”

“You shouldn’t really have to worry about these different parts of the infrastructure stack and game development,” he said. “This stuff should come easy. You should be able to plug and play very easily with it.”

The testnet is expected to be released at the end of Q2 and “some” interfaces for building on the zkEVM will be available on March 20. MATIC will be the “staking token,” with Immutable’s IMX token the “core gas currency.”

Related: GameFi analytics help blockchain gamers sift through crypto games

Ferguson said they chose to build for the Ethereum-based gaming ecosystem because “it would be much better to scale the thing that everyone already wanted to use […] rather than try and compete directly with Ethereum.”

“The right way to onboard the next billion players is not by competing with Ethereum but by building on it and scaling with it,” he said, adding that crypto could triple its monthly users “overnight” if Web3 gaming is successful with a “breakout” gaming title.

“What that requires is incredibly seamless infrastructure and a platform where users can get real ownership of their items without even knowing it’s Web3 under the hood.”

Ferguson added he hopes the success of the platform means that “digital property rights in the game are the norm” so that games are owned by “all players rather than giant corporations.”

Arbitrum airdrop hype helps zkSync addresses jump over 5X in a week

Airdrops were created as a marketing tool before the ICO era, rewarding traders for promoting the project and holding its token for a certain period.

Arbitrum, a layer-2 scaling solution for Ethereum, announced the airdrop of its ARB governance token on March 16, with eligible receivers expected to get the token by March 23. The hype around its airdrop has now helped another layer-2 solution, zkSync, to see significant week-over-week growth.

ZkSync is another layer-2 scaling solution for Ethereum, supporting nonfungible tokens (NFT), and atomic swaps and transfers of Ether (ETH) and ERC-20 tokens within the Ethereum network.

According to data from crypto on-chain analytic firm Nansen, more than 39,000 addresses have bridged over $871 million to zkSync in the last seven days. The number of addresses bridging to zkSync has swelled by 5x in the last week.

Ethereum layer 2 trading volume. Source: Nansen

After the Arbitrum airdrop, zkSync and StarkNet are regarded as the upcoming airdrops with the most potential value. On March 17, nearly 5,000 people deposited more than 536 ETH using the zkSync bridge, and almost 3,000 users deposited over 234 ETH using the StarkNet bridge.

Although zkSync neither has a native token nor announced any airdrop, the enthusiasm around the Arbitrum airdrop has led many proponents to believe they would be rewarded in the near future.

The hype around the airdrops comes amid multiple fake and scam airdrops being attempted by scammers using Arbitrum branding.

A crypto airdrop is a promotional tool for crypto projects to generate hype around the project. The crypto projects behind these airdrops often directly deposit digital tokens into the wallets of active blockchain community members as a gift. Many of these airdrops have specific preset eligibility criteria that reward users for spreading awareness around the project.

Airdrops have been popular since the early stages of the crypto ecosystem, with the first airdrop coming in 2014. Projects have relaxed marketing strategies in recent times owing to regulatory scrutiny.

Related: Ethereum layer-2 solutions may focus less on token incentives in the future

Not all crypto airdrops are equally valuable due to multiple factors, such as the people behind the projects and the project’s use cases — among others. However, Arbitrum, Optimism and zkSync are some of the early layer-2 solutions with proven records. This has attracted more traders to the Arbitrum airdrop, as it could prove to be more valuable than the usual crypto airdrops.

Privacy-focused blockchain network closes Aztec Connect tool

Aztec Network said the research made with Aztec Connect would be usable and critical to developing a next-generation blockchain.

Privacy-oriented blockchain platform Aztec is preparing to shut down Aztec Connect, the network’s privacy infrastructure serving as the encryption layer for Ethereum.

Aztec Network officially announced the upcoming closure of Aztec Connect, and plans to disable Aztec Connect deposits from front-ends like zk.money and zkpay.finance on March 17.

According to a blog post by Aztec, users will be able to withdraw their funds from Aztec Connect with no fees for one year. “While withdrawals will always be possible, they will become significantly more burdensome after March 21, 2024,” Aztec said, recommending users withdraw funds as soon as possible. Since it launched in July 2022, Aztec Connect has amassed more than 100,000 users, the announcement notes.

From March 2024, Aztec will no longer run a sequencer, meaning the current system will no longer publish rollup blocks processing Aztec Connect transactions. “Contract permissions will be renounced, and all rollup functionality will be ceased,” the announcement reads.

As Aztec has fully open-sourced the entire Aztec Connect protocol, the firm encourages the Aztec community to fork, deploy and operate a new version of the system. “We’d love to see an independently-operated Aztec Connect and are ready to fund it,” Aztec said.

According to the announcement, the shutdown of Aztec Connect marks a milestone in the development of a decentralized general-use encrypted blockchain. Before launching Aztec Connect in July 2022, Aztec first experimented with using a zk-Rollup with Aztec 1, which was “slow, inefficient, costly” and limited in functionality to “basic private transfers.”

Source: Aztec

Aztec emphasized that the research made with Aztec Connect will be usable and critical to the development of a next-generation blockchain, providing a basis for a fully programmable version of encrypted rollups, adding:

“It’s undeniable that Aztec Connect was an important stepping stone towards realizing our ultimate goal. It’s now time for us to focus fully on that goal: a decentralized general-use encrypted blockchain.”

After closing Aztec Connect, Aztec plans to focus on developing the universal zero-knowledge language known as Noir and the next-generation encrypted blockchain.

Related: Crypto projects respond to privacy coin ban in Dubai

The news comes amid ConsenSys preparing to release its zero-knowledge Ethereum Virtual Machine rollup on a public testnet on March 28. The launch will follow more than four years of research, potentially enabling faster transactions, higher throughput and better security of settlements on the Ethereum blockchain.

Polygon ecosystem development and upcoming zkEVM launch add to MATIC’s bullish momentum

Polygon’s steady ecosystem development and first-mover status in launching a zkEVM have traders feeling bullish about MATIC’s price.

Polygon Labs, the development and growth team for Polygon, announced that the beta version of its zero-knowledge Ethereum Virtual Machine (zkEVM) would launch on March 27, 2023. It’s possible that Polygon will enjoy a first-mover advantage in this space by launching a public mainnet before zkSync and Scroll.

Zk-based roll-up technology is accepted as the gold standard for scaling. The existing optimistic-based rollups like Arbitrum and Optimism have EVM capability but are less secure because they are “fraud-proof.” Malicious transactions on an Optimistic Rollup can stay valid for up to seven days or more before being reversed. Thus, giving an advantage to zk-technology.

Moreover, the Ethereum community’s focus on Liquid Staking Derivatives may shift toward layer-2 networks after the anticipated Shanghai upgrade in March. This is because the update following Shanghai, Ethereum Improvement Proposal 4844, will reduce the cost of L2 rollups by 10–100-fold. A working zk-based rollup solution will likely attract new projects to its ecosystem.

Polygon (MATIC) has built a strong bullish narrative in the market with the upcoming zkEVM launch. The team’s efforts in the Web3 space are promising and show signs of increasing activity. The growth in its decentralized finance (DeFi) ecosystem has stalled, which could likely stay this way for more extended periods.

Technically, the market structure for Polygon looks bullish. However, the recent 78% increase in MATIC’s price since the start of 2023 could see a correction as speculative buying cools down. Such a situation could possibly provide an ideal entry in MATIC for a swing trade.

Polygon’s DeFi sector has stalled, but Web3 activity is on the rise

Since the start of 2023, Polygon has witnessed a spike in its nonfungible token (NFT) activity, especially for low-cost gaming assets. According to data from Dune Analytics, the number of NFT sales on Polygon surpassed Ethereum for two consecutive months in December 2022 and January 2023. While Ethereum still leads in total volumes, Nansen’s NFT activity data shows that the minting and sale volume on Polygon has been picking up since the start of 2023.

The volume of NFT sales and mints on Polygon. Source: Nansen

Meta also chose Polygon as the base layer for minting digital collectibles on its social media app Instagram. This feature is currently in the limited testing phase but should see traction soon among the 1.28 billion Instagram users.

In November 2022, Matter Labs appointed the former gaming head of YouTube, Ryan Watt, to lead its gaming venture, Polygon Studios. Watt told Cointelegraph that Polygon’s Web3 strategy takes a holistic approach by incorporating “Web2 companies, including Starbucks, Adobe, Clinique and Stripe, to integrate Web3 functionality.”

Additionally, the blockchain houses the development of over 60 metaverse projects, including the leaders in The Sandbox, Decentraland and Somnium Space. Lastly, Polygon’s $450-million raise in February 2022 will likely provide the necessary tailwinds to continue development on the Web3 front.

On the other hand, the Ethereum sidechain’s growth in its DeFi sector has stalled. It could remain stressed due to the ongoing macroeconomic pressure and a regulatory crackdown on stablecoins.

The total liquidity across DeFi applications on Polygon has stayed below November 2022 levels, suggesting that users are still reluctant to interact with these protocols. Besides security risks, the decreasing yield across the DeFi space is also a prominent reason for the decline in activity.

Total liquidity across DeFi applications on Polygon. Source: DefiLlama

In comparison, Arbitrum’s DeFi ecosystem has fared relatively better than most thanks to the anticipation around its token airdrop and active development.

Still, Polygon ranks fifth in total liquidity across DeFi platforms above Avalanche, Solana, Optimism and Fantom, which is encouraging. Favorable liquidity conditions are a crucial necessity for a prospering DeFi ecosystem, and Polygon can benefit from it when focus on DeFi picks up. Moreover, the launch of zkEVM may also attract DeFi development.

Investors are bullish on MATIC

Futures market data shows traders are bullish on MATIC, with an increase in open interest volume toward 2022 highs and a long-to-short ratio of 1.58. While a bullish outlook is encouraging, the prices may pull back to wipe out overleveraged positions.

Open interest volume for MATIC futures contracts. Source: CoinGlass

The on-chain balance on exchanges suggests that not many investors moved their coins onto exchanges as the price surged from $0.75 to $1.25. It suggests confidence among buyers, who are unlikely to sell unless the price falls below $0.75 support.

Polygon balance on exchanges. Source: glassnode 

Related: Solana (SOL) price rally could fizzle out due to weak fundamentals

However, the price could pull back toward the $1 support level as the Relative Strength Index (RSI) metric begins to tap resistance around the 65 level. The bullish momentum likely requires consolidation around the 50 RSI level before more upside.

MATIC/USD daily price chart. Source: TradingView

The organic development of Polgyon’s NFT trading activity and bullish narrative building around zkEVM will likely continue to push MATIC’s price higher in 2023. Needless to say, a lot will depend on the price action of market leaders in Bitcoin (BTC) and whether Ether (ETH) maintains its uptrend.

The views, thoughts and opinions expressed here are the authors’ alone and do not necessarily reflect or represent the views and opinions of Cointelegraph.

This article does not contain investment advice or recommendations. Every investment and trading move involves risk, and readers should conduct their own research when making a decision.

Starkware commits to open source its ‘magic wand’ Starknet Prover

The prover is the crucial engine Starkware uses to roll up hundreds of thousands of transactions and compress them into a tiny cryptographic proof written on the Ethereum blockchain.

Ethereum layer 2 scaling solution StarkWare announced plans to open source its proprietary Starknet Prover under the Apache 2.0 license, which has processed 327 million transactions and minted 95 million nonfungible tokens (NFTs) to date. 

The prover is the crucial engine Starkware uses to roll up hundreds of thousands of transactions and compress them into a tiny cryptographic proof written on the Ethereum blockchain.

“We think of the Prover as the magic wand of Stark technology. It wondrously generates the proofs that allow unimaginable scaling,” said Eli Ben-Sasson, president and co-founder of Starkware.

Eli Ben-Sasson presenting at the Starkware sessions 2023. Source: Cointelegraph

Starkware has faced criticism from the crypto community and competing solutions such as ZK Sync and Polygon for holding onto the IP behind its tech, which contradicts blockchain’s open source and interoperable ethics.

Making the prover open source under the Apache 2.0 license will enable any other project or network — or even games or database developers — to make use of the technology, edit the code and customize it. The tech was released in 2020 and is already being used by ImmutableX, Sorare and dYdX.

A sneak peek of the Starkware sessions 2023. Source: Cointelegraph

Avihu Levy, Starkware’s head of product, was reluctant to commit to a time frame for open-sourcing the prover but said it would occur after the token launch and decentralization of Starknet itself. He agreed, however, that it would be possible this year.

“We want to move forward with a decentralized, permissionless network and that means that you need to have this critical component out there,” he revealed speaking to Cointelegraph.

Levy said the decision to open source the prover showed Starkware was increasingly confident about its technology and said it would also enable projects to be more confident about using it as a crucial part of their protocols.

“In StarkEx, it’s sometimes considered vendor lock-up or lock-in. So the commitment wasn’t just a business commitment it was a technology commitment to StarkEx,” he explained.

“This is a strong signal that you will have everything you need to run it yourself independent of Starkware.”

Starkware has already open-sourced its programming language and EVM competitor Cairo 1.0, Papyrus Full node and is in the process of open-sourcing its new sequencer.

Related: StarkNet overhauls Cairo programming language to drive developer adoption

Ben-Sasson launched the Starkware Sessions conference in Tel Aviv on Sunday, which organizers said was the largest layer 2 conference held so far.

“This is a landmark moment for scaling Ethereum,” he told about 500 developers and guests. “It will put Stark technology in its rightful place, as a public good which will be used to benefit everyone.”

Former Polygon VP of growth shares the secrets behind major partnerships

Polygon’s former vice president of growth, Arjun Kalsy, believes that integrating zero-knowledge roll-up technology will boost the network’s adoption.

Ethereum scaling solution Polygon has witnessed a lot of adoption through partnerships with major brands like Starbucks and Adidas, which has increased the network’s popularity among cryptocurrency users. In the latest episode of the Hashing It Out podcast, Arjun Kalsy, Polygon’s former vice president of growth, breaks down how the network has attracted partnerships with major brands and how the project is driving mass crypto adoption. 

Before leaving Polygon late last year, Kalsy led a team tasked with onboarding companies to promote the adoption of the network. According to him, talking to brands looking to pivot from Web2 to Web3 or add elements of the decentralized world to their platforms was always enjoyable. The onboarding process involved several technical meetings where the Polygon network and its capabilities were scrutinized by these major brands, who consider integrating other technologies “a big deal.”

Kalsy explained that after the first set of big brands announced partnerships with Polygon, more doors were opened for the network. As major brands evaluated and approved the network, other teams gained the confidence to work with Polygon.

Despite the network’s impressive growth, Kalsy believes there is so much more that could come out of its use of zero-knowledge rollups. Zk-Rollups technology is expected to increase the speed at which the layer-2 platform can achieve finality while ensuring high-level security.

Polygon, zk-Rollup
Tune in for more podcast series from Cointelegraph

After Polygon, Kalsy moved to BitDAO, where he is head of ecosystem at Mantle, an Ethereum layer-2 network with a modular design. At BitDAO, Kalsy is looking to onboard companies seeking to evolve from centralized structures to decentralized leadership. He argued that several companies would make the switch to decentralized governance in the coming years.

He argued that all new companies have a predictable trajectory that involves raising money at the early stage and going public as the company grows, which is a long winding journey that can be cut short with decentralized governance. He said that with decentralized autonomous organizations, new companies go public immediately, allowing them to benefit from the transparency and global coverage that comes with opening up the governance of a company to everyone.

Related: NFT Steez and Cryptoys CEO discuss the future of toys and entertainment within Web3

On the future of the cryptocurrency industry, Kalsy believes that the latest market downtrend is part of the regular ups and downs of all asset classes. He said the market recovery would be swift and could propel the industry to new highs.

In this episode, host Elisha Owusu Akyaw and Kalsy also discuss:

  • Growth management at a major Web3 firm
  • Evolution of companies into DAOs
  • Polygon’s future technical upgrades — zero-knowledge rollups
  • The growth of Ethereum scaling solutions
  • BitDAO and the Mantle network

For more on Polygon’s growth and the pivot of companies from centralized entities to decentralized autonomous organizations, listen to episode six of Hashing It Out on the new Cointelegraph Podcasts page or Spotify, Apple Podcasts, Google Podcasts or TuneIn.