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What Is Validium and How Does it Make Ethereum More Scalable?
Scalability is a crucial factor in enhancing success in cryptocurrency's dynamic and fast-paced
world. With Ethereum being among the most used blockchain platforms today, Anthropic has
innovated Validium to improve its scalability. But what exactly is Validium, and how does it
make Ethereum more scalable?
Validium is a blockchain layer-2 scaling solution used to process transactions and store
data off the chain to improve the mainnet throughput. It's a preventive mechanism that
helps curb theft and fraud in blockchain transactions by ensuring that the user authorizes
every transfer from one account to the other.
Validium
provides Ethereum several benefits,
including enhanced user privacy, lower transaction fees and faster transaction speed. It
also eases congestion and improves security by using zero-knowledge proofs, which keep
detailed data on transactions off the public blockchain.
Image Source: X.com
As the popularity and use of Ethereum continue to grow, its disadvantages and limitations are
becoming more evident daily. However, Validium is here to solve these issues and take Ethereum
to new heights by empowering users with efficient and seamless transactions.
According to a tweet by OriginStake, 'the zkEVM Validium is an adapted version of Polygon's
zkEVM node and contracts that utilize Avail's data availability blockchain instead of Ethereum.
The zkEVM Validium reduces the amount of data that needs to be posted to Ethereum by up to
90%.'
Check out this tweet through the following link:
https://twitter.com/OriginStake/status/1721945047078453705
.
How Does Validium Work?
While looking into how Validium works, we will discuss it in terms of how it handles various
processes as follows:
1.
Transactions
Through the validium chain, users submit the transaction to the operator, a node responsible for
performing transactions. However, some validiums might use a sole operator to execute the chain
or depend on Proof-of-Stake (POS) to rotate the operators.
The
operator
combines the transactions into batches and transmits them for proving on a proving
circuit. The proving circuit receives the batched transactions and additional relevant data as
inputs and sends a validity proof to verify the correctness of these operations.
2.
Statement Commitments
A valid state is hashed as a Merkle Tree by storing the root in the main contract on the Ethereum
blockchain. This root also called the state root, behaves like a cryptographic commitment to the
current account state and balance available on the validium.
To update the state, the operator must create a new state root once done performing the
transactions and then submit it to the contract on the chain. If validated, the proposed state is
validated, and the new form is approved on the validium.
3.
Deposits and Withdrawals
To deposit, a user must move the funds from Ethereum to validium by depositing ETH or any
other
ERC-compatible token
in the on-chain contract. This contract transmits the deposit
operation to the validium off-chain, and the user's account is credited with the amount.
Additionally, the operator batches this transaction.
To withdraw to the mainnet, the user must initiate the transaction from the validium and submit it
to the operator, where the transaction is validated and included in a new batch. However, users'
assets are eliminated before they exit the network. Once the batch's validity proof is verified, the
user can call the main contract to withdraw the initial deposit.
Sometimes, validium allows direct withdrawals from the on-chain contract without going
through the operator. However, the user must provide Merkel proof to verify the inclusion of the
account in the state root.
4.
Submission of Batches
Once done executing a batch of transactions, the operator transmits the validity proof to the
verifier contract and recommends a new state root to the main contract. If the proof is validated,
the main contract updates the state on the validium and finalizes the batched transactions.
Essentially, validium is a pure off-chain scaling protocol. Unlike zk-Rollups, which require block
producers to publish transaction data, Validium only requires block headers to publish transaction
data.
Read more on zk-rollups here!
Image Source: Moralis Academy
Validium as the Solution to Ethereum's Scalability
Validium is providing specific solutions to the challenges faced by Ethereum, such as high fees,
network congestion and
scalability
faced by Ethereum. Validium scales Ethereum in the
following ways:
Lowering Transaction Fees:
Making transactions via Ethereum is quite expensive due
to the high gas fees charged per transaction. However, with validium, some transaction
subsets can be performed off-chain, hence avoiding payment of gas fees. This helps users
save money – regardless of how small the amount may seem.
Supporting Processing of Microtransactions:
Validium facilitates the conduction of
offline transactions, helping avoid higher per-transaction gas fees. This makes it viable to
conduct microtransactions without paying crazy transaction fees.
Boosting Platforms that Offer NFTS:
Deployment of Validium on NFT platforms helps
users buy and sell NFTs without paying high
gas fees
per transaction. The integration of
validium with NFT marketplaces makes these assets more accessible and thus eases
economic difficulties regarding digital assets.
Easing Congestion in the Ethereum Network:
Carrying out
many Ethereum
transactions on-chain creates network bottlenecks. With validium, it diverts some of the
transactions, especially the micro-ones, off-chain to ease congestion on the main network.
Scaling Decentralized Applications (dApps):
Scaling dApps while maintaining security
and decentralization is challenging. Validium gives Ethereum dApps a direct pipeline to
facilitate off-chain processing of small crypto payments. This enables it to handle more
transactions and users per second.
You can read more on dApps here!
Frequently Asked Questions on Validium
1.
What is the Difference Between Validium and ZK-Rollups?
Validium and ZK-rollups are blockchain scaling solutions. These solutions aim to increase the
number of transactions per second on the blockchain network while ensuring the network is
secure. Nonetheless, validium and ZK-rollups differ in handling data availability, impacting their
trade-off on security, decentralization, and scalability.
2.
What is Scalability in Ethereum?
Scalability in Ethereum means the ability of Ethereum to be used by multiple users without
sacrificing its functionality. Scalability aims to improve transaction processing speed on the
Ethereum network. As per statistics,
Ethereum's capability to handle transactions is limited to 7-
15 transactions per second
, hence the need for scalability.
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3.
What is Layer 2 Scaling for Ethereum?
Layer 2 scaling is a solution that improves both transaction speed and transaction throughput on
the Ethereum blockchain. This scaling facilitates transactions off-chain (layer 1), thus helping
reduce transaction gas fees.
Image Source: Forkast News
According to a tweet by Thirk, 'Ethereum continues the long march to absorbing all side/ghost
chains. Every L1 will eventually have a validium on Ethereum.'
Check out this tweet through the following
link:
https://twitter.com/theThirk/status/1671239398258536448
Verdict on Validium
Validium offers solutions to scalability issues in Ethereum. This protocol acts as a catalyst for
transactions on the Ethereum blockchain by utilizing off-chain processing, zero-knowledge
proofs, and verification of batches to improve transaction speeds, enhance user privacy and cut
transaction fees. With its advantages and many use cases, validium has the potential to
revolutionize blockchain technology and promote the adoption of dApps.