Weekly Rollup #13
Aztec's encrypted ZK-rollup, Catalyst x Eclipse, Celestia interoperability & Phase 5 begins, Will any apps stay on L1? | Week ending May 5th
Welcome to Modular Media! We cover news, updates, educational content, and more within the modular blockchain ecosystem.
Subscribe to get posts sent directly to your email every week, and follow us on Twitter for modular-related updates!
This week’s issue covers:
📣 News & Announcements
Introducing Aztec’s encrypted zk-rollup
The big news last week was Aztec’s announcement of its roadmap for its new L2 zk-rollup that will bring generalized private smart contract execution to the Ethereum network.
Encrypted Ethereum
As you may already know, Ethereum is a global, public state machine that anyone is able to connect to, transact on, and view (it’s public). Aztec extends this global state machine to also include private state (this is huge!). “This hybrid public-private state machine processes both public and private execution of smart contract logic”. And yes, according to the team, there will be “seamless composability across encrypted and unencrypted transactions”.
One of the interesting aspects about Aztec (aside from the fact that the original team is also behind the development of PLONK, one of the most popular SNARK proving systems today) is that they use their own native programming language, “Noir”, which aims to become the universal zero knowledge programming language (“Noir’s vision is to be the LLVM for zkSNARKs”). Noir can compile to any crypto backend, leaving the door open for Cosmos, Solana, or any other network-based teams to integrate zk-proofs with Noir.
Why do we need privacy on-chain
One of the biggest reasons we need to start bringing privacy on-chain is to attract institutions. As most of you may already know, everything you do on-chain, is well, on-chain. This means anyone can go to a block explorer, enter an address and get a look at everything that address has done. This essentially is terrible for big companies and institutions, as they probably wouldn’t want you and me looking at how much they pay their employees, how much they pay for supply contracts, etc.
That being said, privacy isn’t just for big businesses, as everyday users will also benefit from on-chain privacy. For example, recall back to 2021 when ConstitutionDAO bid for an original copy of the US Constitution. The DAO ended up raising over $40M in just a short amount of time in order to purchase this copy of the constitution but was ultimately outbid by none other than Citadel CEO Ken Griffin - the problem was that everyone knew exactly how much the DAO raised. Another use case is private on-chain voting for DAOs (learn how they helped the NounsDAO team in this regard). Then of course there are the more obvious use cases such as privacy-enabled defi, stables (like USDC, DAI, etc.) that enable privacy-preserving payments, gaming, and more.
What’s Next
According to the team, “Developers can expect a local testnet by the third quarter of 2023, and users and network stakeholders can expect to access a full-fledged public testnet by early 2024”. In the meantime, you can learn more about Aztec here if you’re interested.
Catalyst Brings Cross-Chain Liquidity to Eclipse Rollups
On May 1st, Catalyst and Eclipse announced their partnership, which aims at bringing permissionless connection and liquidity to rollups.
What is Eclipse
Eclipse is a RaaS solution that developers can use to launch their own custom execution environments in just a couple of minutes. So rather than having to build on top of a generalized rollup (dapps living together on the same chain), teams can instead have their own dedicated rollup.
Eclipse enables builders to choose their preferred virtual machine (Ethereum VM or Solana VM), preferred data availability layer (Celestia, Polygon Avail, Eigen DA), and other customizations they think are best for their specific rollup. This could be using the chain’s own native gas token, adding privacy features, MEV options, and more.
What is Catalyst
Catalyst is building a cross-chain liquidity layer for the modular ecosystem. “Catalyst allows any chain to permissionlessly connect liquidity to that of another chain. New chains can automatically transfer to/from any other chain from day one”.
Let’s use Ethereum and Polygon as an example to show how Catalyst works. Both of these chains (along with any other Catalyst-connected chains) have a Catalyst smart contract deployed on their network.
If I want to go from Ethereum to Polygon, I can simply deposit my 10 ETH on the Ethereum contract. Then on the other side, on the Polygon contract, the value of my original 10 ETH would be swapped for the same value of MATIC - ultimately functioning similarly to an AMM (swaps between rollups).
One of the advantages of this method is the fact that we won’t have fragmented liquidity (there is only 1 MATIC token for example).
This is just a short, brief introduction to Catalyst, to learn more make sure to visit their website.
How this partnership works & what it means for users
This partnership means that any rollup that was deployed with Eclipse, will automatically be able to connect with any other chain permissionlessly. Whether it’s between two rollups within Eclipse, or an Eclipse rollup with a completely different chain that is also connected to Catalyst (Ethereum, Polygon, etc.).
Essentially, the Eclipse rollup would just have to make sure there is enough liquidity inside their Catalyst smart contract in order to facilitate these cross-chain transactions.
For developers, this partnership leads to a scenario where teams can deploy their own dedicated, custom rollup in minutes, with automatic connection to the broader blockchain ecosystem, including its liquidity and users, from day one.
For end-users, this means we would be able to access all these different applications from whatever chain we’re on, while at the same time benefiting a smoother experience thanks to the fast finality that Catalyst enables.
Out-of-the-Box Interoperability & Phase 5 Begins
Permissionless interoperability for Celestia’s sovereign rollups
As you may already know, Celestia is building an ecosystem of sovereign rollups. Celestia itself is a data availability/consensus solution, however, there are a handful of solutions, like Rollkit for example, that are making it seamless to launch your own rollup on top of this Celestia’s base layer.
That said, these sovereign rollups would be useless if they couldn’t connect not only to one another, but also to the broader blockchain ecosystem, and that is where Hyperlane comes in. Hyperlane will bring out-of-the-box permissionless interoperability from the day you launch your Celestia chain.
When you launch your new rollup, you would be able to:
customize your security modules (ISMs)
choose which assets to support for bridging
choose validator & relayer providers
& chains you want to connect to at launch
Because Hyperlane is also integrated with other solutions like Caldera and Eclipse, this means Celestia’s sovereign rollups would have access to these other environments as well.
How is Hyperlane different than your typical bridge solution
One of the main benefits for developers is the fact that Hyperlane is permisisonless.
Most bridges we’ve been using these past few years have been permissioned. This means that developers/teams essentially need to ask for permission from the bridge in order to use it to connect to others. This leads to further delay in building liquidity and users for your network. Although teams were met with this centralization concern, it ultimately needed to be done in order to make the bridge as “safe” for users as possible (”safe” in quotes because I’m sure we’ve all realized just how safe, or unsafe, these bridges can be).
This leads to another benefit of Hyperlane - security modules (ISMs).
According to the team, “Hyperlane separates the product of interchain messaging from the interchain security”. This allows for customizability and flexibilty when it comes to the level or type of security you want for your rollup, as security is incorporated into different modules developers can choose between. For example, this includes: Economic security via staking, security via designated signers (multisigs), optimistic security, or security through light client verification (zk). These security modules can even be different depending on the transaction!
Phase 5 of the Blockspace Race
As a reminder, the Blockspace Race is Celestia’s first incentivized testnet program, launched in five different phases spanning nine weeks total.
During this event, each participant will run their own node (one node per participant), and there will be different tasks that the nodes can accomplish during each phase. Each task corresponds with a certain node type (validator node, bridge node, etc.), and the node participants receive points for completing these tasks. Celestia will be allocating 15M TIA tokens as rewards for participants for their service. Once Celestia reaches mainnet, the testnet participants will be able to claim their token rewards.
Phase 5 Details
The most note worthy new task added to the program was for validators to setup and start running an early version of the Quantum Gravity Bridge, which paves the way for Celestiums (which requires further discussion at a later date).
You can learn all about this new phase here.
More News & Announcements
AltLayer launched phase one of Altitude, the network’s testnet launch campaign, which included the launch of the network’s “multi-sequencer rollup”. Learn how you can start experimenting today.
The Modular Cloud team has just deployed a block explorer dedicated for the Caldera ecosystem. As more and more solutions turn to modularity, we’ll need an easy way to track data across every layer of the transaction, and that is what Modular Cloud is enabling.
Take a look at all the different dapps and protocols that are building with Eclipse, through the network’s new “constellation chart”.
Babylon (testnet) brings BTC security to Cosmos’ Juno Network
Phantom multichain launches. Now, users can use Ethereum, Polygon, and Solana without switching wallets. “Connect to dApps automatically and never manually switch networks again”, and more.
Stage 1 of Eigen Layer’s mainnet is expected to go live soon. If you’re someone who wants to be amongst the early participants of ETH restaking, then you can fill out this indication of interest form today.
“Axelar's General Message Passing (GMP) is now available between Cosmos and EVM chains, providing composability for dApps that span both ecosystems”. Somm Finance is among the first to leverage this new connection by launching Arbitrum-based defi vaults.
For anyone that minted Polygon’s commemorative soulbound NFT when they launched zkEVM, an NFT airdrop has landed in your zkEVM wallet
Safe (previously Gnosis Safe) is now live on Polygon zkEVM thanks to a new interface developed by the Quickswap team, QuickSafe
The Madara sequencer (a community-built Rust-based sequencer for the StarkNet ecosystem, has 100ms block times with 250 TPS - perfect for on-chain gaming.
Here’s a thread about Class Lambda’s sequencer & prover architecture they are building for StarkNet
Alchemy is bringing its web3 API services to Starknet
Here are the 8 different bridges you can use today to bridge to zkSync Era (zkEVM), including Layer Zero, and Multichain.
Particle network, “a full-stack middleware protocol”, has integrated Era.
Dopex launched Odte, “zero-day to expiry options” (options that expire the same day) on Arbitrum
Cross-chain Curve vote bounties are now live on Arbitrum through StakeDAO’s voting platform
The Biconomy SDK is bringing account abstraction to Arbitrum
Check out the new OP-Labs (team behind Optimism’s development) CEO
OPtimism announced that “the AttestationStation has been upgraded to the EAS standard, giving developers one common standard for issuing & reading attestations that interoperate across the ecosystem”
Aave is now live on Scroll’s alpha testnet
“Probably the first cross-integration between two Fuel ecosystem projects @allsparkgg and @FueletWallet“
Ankr announces its RPC connection to the Mantle network. In short, RPCs are a way to access information from full-nodes (so from Mantle’s L2 network nodes), without having to run one themselves
Fabwelt announces that they’ll be building out their gaming ecosystem on the mantle L2 network. “With in-game NFTs, Play to Earn, and DEFI, we create a high-end gaming ecosystem and enhance the fun.”
Stream NFT announces partnership with Mantle network: “This collaboration will enable StreamNFT to offer its Rent & Loan protocol to the wider NFT ecosystem”
Here’s an overview of the Taiko protocol design, as the Ethereum L2 network now approach Alpha-3 testnet launch
Taiko's project board is now entirely public:, allowing anyone to publicly see what the team is building
Caldera, a RaaS solution, now supports fully compatible bridging with ERC-1155.
UniDex Exchange announced that they’ll be leveraging Caldera’s RaaS solution to build their own OP Stack rollup dedicated entirely to its defi aggregator platform.
Oveit announced that they’ll be leveraging AltLayer’s RaaS solution to build out their large-scale NFT ticket event platform
📚 Discourse & Education
Will any apps stay on L1?
Ethereum and modular blockchain critics often claim that rollups are “parasitic”. They often depict a rollup-centric future consisting of busy L2s and vacant L1s, posing the question of how base layers economics will work.
Jon Charb from DBA suggests a different rollup-centric future, where meaningful activity stays on L1. The key distinction is between transaction activity and transaction value. It’s likely that the vast majority of transactions do shift to L2s / rollups, while high value use cases remain on L1. It’s these high value use cases that already have product-market fit and can sustainably accrue value, even when 99% of transaction activity is on rollups.
What types of high value use cases are we referring to?
Polynya wrote an article focused on this thought experiment, where Ethereum L1 fits their classification of “premium execution layers”. They list examples like transactions between:
High-value rollups
Corporations
Governments
They also discuss reasons why premium execution layers are good homes for these use cases, citing things like:
Sound money base asset
Economic security
Stability / ossification
Quality auditing community
Etc.
Are we far from governments using crypto rails? Probably. Do current use cases for premium execution layers (wales trading NFTs) seem ridiculous? Absolutely. Is the path from degen financial toys to global financial rails clear? Nope. But underneath it all, the economic model is already working.
More Discourse & Education
@0xRainandCoffee writes an article on the inner working of shared sequencers, why they’re important and how they’ll shape the future ✍️🔥
@tracecrypto1 explains the differences between ZK proof aggregation, recursion and composition 💬🧠
@_prestwich writes an article “The Definitive Guide to Sequencing” discussing sequencers, shared sequencers, sequencing vs. proposing and more ✍️🔥
@0xSalazar breaks down the issues with centralized sequencers and how shared sequencers can help 💬💎
@0xkydo demystifies shared sequencers and how they deal with transaction vs. state roots 💬💎
Empire releases an episode discussing shared sequencers, economic tradeoffs, cross-domain MEV and more with Ben from Espresso and Josh from Astria 🎙️🧠
@_andyrdt writes a Scroll forum post explaining the “proof overflow problem” and how batches of transactions can be too large to fit in the zkEVM circuit ✍️
@ChrisYicheng discusses the rise of Layer 3s and app-chain solutions, covering L3 benefits and interesting research topics 💬
@yuxiao_deng explores how EigenLayer can play an important role in the MEV space, covering three interesting solutions 💬
Galaxy (@waltjsmith) writes an article exploring MEV on EigenLayer and how node operators could become powerful block proposers on Ethereum ✍️
@SheaKetsdever writes an article explaining Flashbots new MEV-Share protocol, how to use it and how it differs from MEV-Boost / MEV-Geth ✍️
The Rollup releases an episode discussing inter-chain communication infrastructure with Arjun from Connext 🎙️
@musalbas explains how data availability is different from data storage, using the recent Lens Protocol / Bonsai announcement as an example 💬
SevenX Ventures writes an article exploring the intersection of ML and ZK / blockchains ✍️
Bankless releases an episode discussing AI and Web3 with Mohamed and Qiao from Alliance DAO 🎙️
a16z releases an episode on “Data availability and Danksharding” 🎙️
@bkiepuszewski explains the moon math beyond Polygon zkEVM and Starknet is simple terms 💬
@colludingnode explains why secure bridges between two completely disconnected blockchains are not possible 💬
Because Bitcoin hosts a Twitter Space discussing Fuel Network and scaling Ethereum with modular execution with Nick from Fuel Labs, @KingWabii and Nader from Lens 🎙️
Bell Curve releases an episode discussing Solana’s MEV problem with buffalu from Jito Labs and defi guy from Ellipsis Labs 🎙️
Unchained releases an episode discussing restaking, liquid staking, and superfluid staking with Sreeram from EigenLayer and @Lomashuk 🎙️
Skip Protocol writes an article on how “Adopting MEV-tendermint reduces missed block rate by 56%” ✍️
Bell Curve releases an episode exploring “Solana’s MEV problem” 🎙️
@BigSky_7 breaks down easier ways to think about MEV, using non-crypto analogies 💬
@0xShivani explains how Aztec programmable privacy works in simple terms 💬
@jon_charb plays devil’s advocate to the modular blockchain thesis and explores what we might get wrong 💬🤔
Starknet hosts a community call focused on an “Introduction to SHARP Verifier Smart Contracts” 🎙️
@jamesjho_ illustrates Arbitrum and Optimism’s annualized revenue growth and paths to profitability 💬📊
@ChrisYicheng explains the advantages of L3s
That's all for this week! Thanks for reading 🧱🎬
If you found this useful, please like and retweet this tweet so more people can see it 🙏
