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zkSync Era

Key Takeaways​

  • zkSync Era uses Rollups to increase Ethereum scalability by consolidating transactions off-chain and sending them to the main chain in a single batch via a cryptographic proof of validity.
  • The platform generates revenue through user transaction fees, which is similar to how Ethereum generates revenue.
  • L2 Fee Revenue and profit from L1 Tx for L2 Tx initiation are sources of revenue, while L1 Contract Operation Cost is a cost.
  • The cumulative profits and transaction fee breakdown are analyzed in the report by Modular Economics.

1. Overview​

In the zkSync Era, Rollups are used to increase Ethereum scalability by consolidating transactions off-chain and sending them to the main chain in a single batch via a cryptographic proof of validity. The platform aims to preserve Ethereum's values of freedom, self-sovereignty, and decentralization at scale. Additionally, zkSync rollups are cost-efficient for most transactions compared to other scaling solutions.

The operator in zkSync Era executes the transactions and generates a zk proof. These are stored at L1.

Learn More about the architecture at “Architecture of zkSync Era”

2. Economics​

In terms of economics, zkSync Era generates revenue through user transaction fees, which is similar to how Ethereum generates revenue.

2.1 Revenue & Cost (On-Chain)​

Source: Modular Economics | M3TA

2.1.1 Revenue

  • L2 Fee Revenue: revenue generated from transactions in L2
  • Profit from L1 Tx for L2 Tx initiation: Users in L1 initiate transactions to be included in a queue where the transactions wait to be initiated in L2. Users pay a fee for inclusion and execution, which is calculated as revenue. However, the cost of initiating transactions in L2 is excluded from the calculation to determine profit.

2.1.2 Cost

  • L1 Contract Operation Cost
    • commitBlock: checks the L2 block timestamp, processes the L2 logs, saves data for a block, and prepares data for the zk-proof.
    • proveBlock: validates the zk-proof.
    • executeBlock: finalizes the state, marks L1 -> L2 communication processing, and saves the Merkle tree with L2 logs.

2.1.3 Asset

2.2 Revenue & Cost (Off-Chain)​

2.2.1 Revenue

2.2.2 Cost

  • Operator cost: Since a single operator wholly does the computation, the computing cost is incurred.

3. Analysis​

3.1 Cumulative Profits​

Source: Modular Economics | M3TA

3.2 Transaction Fee Breakdown​

Source: Modular Economics | M3TA

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