In 2024, the Rollup ecosystem will develop rapidly, cross-chain interoperability will be improved, ZK Rollup and the new generation of virtual machines will show greater potential, and application chains and customized L2 will become important trends.
Author: @ayyyeandy
Translation: Blockchain in Vernacular
Rollup moves multiple off-chain transactions from the main Bitcoin blockchain to an independent network, processes them, and then submits a compressed transaction back to the chain. Common types of Rollup include optimistic rollups, ZK-Rollups, and sovereign rollups. Some current representative projects: B² Network, Bitlayer, BOB, Citrea, QED Protocol, Zulu Network, GOAT Network, Mezo, Bitfinity Network, Arch Network, etc.
In 2024, the Rollup ecosystem develops rapidly, and the rise of application chains and customized L2 solutions promotes innovation in decentralized finance. Competition between Rollups gradually weakens, with more attention paid to cross-chain interoperability and user experience. ZK Rollup has attracted a lot of attention with its privacy and performance improvements, and the new generation of virtual machines Rollup leads the traditional EVM in performance. At the same time, the design and governance issues of decentralized sequencers have become the focus of discussion. The revenue model of Rollup faces challenges, but the overall market potential is huge.
@ayyyeandy made some predictions about the development of the Rollup ecosystem in 2025. The following is the text:
As the importance of chains decreases, more value will flow to applications, and we will see thousands of application chains or L2s redistribute revenue to applications through governance or protocol design. We are entering an era where applications begin to take up arms and demand the revenue they deserve, otherwise they will turn to their own chains or choose an underlying chain that is willing to share revenue. This will drive the emergence of more customized/niche L2s that can provide revenue distribution to applications, as well as chains designed specifically for applications, gradually vertically integrating their technology stacks.
Tribalism between Rollups will decrease as the user experience shifts from switching between chains to a holistic experience of just “using crypto.” Of course, we’ll still see competition from Optimism and Arbitrum, and ZK Sync and Scroll, but overall I think competition in Rollups will decrease at the chain level as communities are more inclined to work together to expand the market pie rather than fighting each other for a limited share of users.
Rollup revenue will decrease. This is partly due to the increase in the number of Rollups, the need for Sequencer revenue sharing, and the trend of application chains building their own chains (these applications may have chosen L2 operations).
Ethereum-based Rollups will start to gain more traction in tech circles, VCs, and Ethereum believers as they are seen as a key enabler to resolving the “L2 is parasitic on L1” debate. Lisk-based Rollups using the same pre-confirmation service or market can achieve synchronous composability with each other and with Ethereum L1. This space is still a green field.
Rollups that replace virtual machines/next-generation virtual machines will rise strongly. These will become the best Rollup technology stacks in terms of TPS and gas fees per second. Their performance will surpass any highly integrated Rollup with EVM that is not parallelized. SVM, MoveVM, FuelVM, LinuxVM, ZKVM, etc. will gradually become popular and become the home of some very cool applications.
ZK Rollup is about to have its moment in the spotlight. While Optimistic Rollup has dominated market mindset and usage (e.g. TVL), the rapid performance improvement of ZK Rollup is worth watching. I expect a large number of ZK Rollups to be launched, and their cost and speed will also increase rapidly.
The future of Ethereum and the modular ecosystem is very exciting.
Link to this article: https://www.hellobtc.com/kp/du/10/5463.html
Source: https://x.com/ayyyeandy/status/1843946170827096131
