Blockchain Vocabulary - Rollups (2/30)

Rollups offer another possible solution to the “The Scalability Trilemma.”

Rollups validate transactions off-chain but post transaction data to the blockchain.

Rollups are considered one of the best general-purpose scaling solutions because they take the validation burden off-chain while still utilizing the security of the underlying blockchain.

Methods of validating transactions so they can be “rolled up” to the blockchain:

• Optimistic rollups: trust the transaction is correct unless there is a dispute claim (they are optimistic).
• Zero-knowledge rollups: trust the transaction is correct given zero-knowledge proof (a method by which the prover can prove to the verifier that a given statement is true, while the prover avoids conveying any additional information).

Optimistic rollups struggle with making the dispute resolution process efficient, while the complex technology behind zero-knowledge proofs makes them less compatible with existing infrastructure and applications.

Summary: rollups scale blockchains by taking validation off-chain but keeping storage and security on-chain.

More Resources:

• Rollup explanation by Finematics
• Examples: Arbitrum One and Loopring
• Rollup definition by Consensys: “Rollups (pronounced “roll ups”) are one element in the set of tools and infrastructure being built as Layer 2, the scaling solutions for the Ethereum network. They consist, in general, of solutions in which the transaction data is still kept on Layer 1, the original Ethereum network, while transaction computation occurs on a side network, freeing up computational power on Layer. There are different ways of approaching this problem from a technical point of view, namely Zero Knowledge, or ZK, rollups, and Optimistic rollups.”