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ZK-rollup

A ZK-rollup is a technology that processes many crypto transactions together. This can help a blockchain like Ethereum process more transactions, potentially at a lower cost.

Last updated • 2 min read
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What is a ZK-rollup?

A ZK-rollup is a Layer 2 solution. It’s an additional layer built on top of an existing blockchain, such as Ethereum. The underlying blockchain is called Layer 1.

Transactions are first processed off the blockchain. They’re then combined into a single batch. Only summarized data or a cryptographic proof is submitted to Ethereum.

ZK stands for zero-knowledge. The proof shows that the batch is valid without revealing all its data. Whether transaction details are actually kept private depends on the ZK-rollup being used.

An example of a ZK-rollup

Imagine a thousand people want to make a transaction on Ethereum at the same time. Without a ZK-rollup, Ethereum would have to process each transaction separately.

With a ZK-rollup, the thousand transactions are first bundled off Ethereum. The rollup then sends one proof to Ethereum showing that the entire batch is valid. So Ethereum has less work to do on each transaction.

Why are ZK-rollups important in crypto?

A busy blockchain can lead to slow transactions and high fees. ZK-rollups help reduce this problem by processing many transactions off Layer 1.

You may come across ZK-rollups in news about Ethereum, new Layer 2 networks, or lower gas fees. Gas fees are the costs of making a transaction on a blockchain.

Transactions take place off Ethereum, but the proof is verified on Ethereum. This means the rollup can benefit from Ethereum’s security. A ZK-rollup doesn’t automatically make transactions completely private; this varies by application.

Disclaimer: This content is for informational purposes only and does not constitute financial, investment, legal, or tax advice. The information provided may be incomplete, inaccurate, or outdated and should not be relied upon as such. Nothing on this website should be considered a recommendation to buy, sell, or hold any cryptocurrency. Investing in crypto-assets involves risk of loss.