StarkNet, an Israel-based Ethereum layer-two solution, announced its mainnet launch.
What are layer 2 solutions?
To recap, layer 2 solutions are essentially blockchains on top of a blockchain. Usually, they are built to relieve the base layer of congestion and help alleviate scalability issues, as faced by Ethereum and Bitcoin. The former has especially taken the spotlight when it comes to layer 2s, as rising user numbers hamper Ethereum’s usability. The most promising layer-two solutions for the futures are predicted to be optimistic rollups and zk-rollups, with the latter being Vitalik Buterin’s preferred scaling solution.
What is Starkware?
Starkware is the company behind Starknet, a zk-rollup solution that aims to bring massive scalability to Ethereum while preserving its security, permissionless nature, and decentralisation. Starknet was released on a public testnet in June, with the second Alpha version supporting smart contracts as they are commonly used on the Ethereum mainnet.
This second Alpha version, which is based on the very zk-rollups that are Ethereum’s best hope of a decentralized scaling solution, has gone live on Ethereum mainnet this week. It will also support permissioned smart contract deployment, meaning protocols can reach out to Starknet if they want to onboard.
The deployment of Starknet on the Ethereum mainnet follows an announcement by the company that it had raised $70 million AUD in a Series C funding round, putting the firm’s valuation at $2.4 billion AUD. Only seven months earlier, StarkWare had raised $104 million AUD in a Series B round.
What can users expect from Starknet?
Starknet is one of the biggest cornerstones to scaling Ethereum, as its scalability engine enables partners to submit on-chain trades in zk-rollups. This greatly reduces friction encountered through gas fees, which is precisely why so many people, Vitalik Buterin being one of them, are betting their real and proverbial money on zk-rollups.
Starknet’s security model will mirror that used on testnet, with every state transaction backed by a STARK proof, ensuring its validity. Moreover, state data will be published on-chain, guaranteeing full constructibility from layer-one chains.
Starkware also provides StarkEx, a standalone scaling SaaS used by dYdX (a perpetual futures exchange), DeversiFi (spot trading and payments), SoRare (NFT minting platform), and Immutable X (an NFT layer-two chain). Gas per transaction was reduced by a factor of 100 to 200 according to Starkware, with gas/tx being 1100 for a zk-rollup. Starkware announced that it had settled $110 billion AUD in trades and over 27 million transactions with StarkEx, another reason why hopes for Starknet are so high.
Will this fix Ethereum’s gas woes?
As other layer-ones like Avalanche and Solana begin to encroach on Ethereum’s territory and users start becoming sick of extortionary gas fees, the Ethereum community eagerly awaits zk-rollup solutions like Starkware. Although they may not save the day altogether – zk-rollups do not provide the kind of near-zero gas fees that would make Ethereum truly compatible for mass usage – they could buy it valuable time while the mainchain is working on base layer scalability with Ethereum 2.0. For cheap gas, you may want to start trying out Starknet DApps from now on.