Matter Labs Unveils Layer-2 Scaling Solution for Ethereum Payments

The latest ethereum hard fork, Istanbul, is bringing Layer 2 solutions to the network - this time in the form of a payment channel.

Cryptographic research hub Matter Labs released Thursday the testnet of ZK-Sync, in what the firm claims is a step toward making blockchains compete with centralized systems for handling millions of transactions a day.

Famously, Visa can handle 24,000 credit card transactions per second while ethereum can only deal with about 15 tps.

Based on Rollups, a scaling protocol first proposed by ethereum developer barryWhiteHat and expounded upon by ethereum creator Vitalik Buterin in 2018, the Layer 2 solution uses zero-knowledge proofs and recent changes to the ethereum network from the Istanbul hard fork for implementation.

The tech behind ZK-Sync.ZK-Sync transactions are completed using a smart contract created on the ethereum state, the underlying blockchain which serves as a digital ledger of all ethereum transactions.

Matter Labs created a sidechain for ethereum transactions to interact with one another without touching the mainchain.

Other Layer 2 ethereum solutions have stalled at the same point, facing costs too high to justify using the system.

As Gluchowski said, Istanbul proved to be the answer for Matter Labs and other Layer 2 payment systems.

Like a mailing service, users pay a gas fee to transmit information on the ethereum blockchain.

By packaging transactions off-chain and stamping them with a cryptographic proof for validity, Matter Labs says Layer 2 solutions like ZK-Sync have the possibility to scale ethereum's current payment network.