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Top Layer2 Scaling Solutions | Bankless Africa Weekly Newsletter
This is the Bankless Africa Newsletter, your one-stop plug for well-curated and up-to-date crypto and web3 news around Africa.
Blockchain's need for faster and cheaper transactions has put scaling solutions in the spotlight. And while there are various options available, Layer 2 has emerged as the popular choice for improving blockchain scalability. In this issue, we will explore how the top Layer2 networks - like Optimism, Polygon, Arbitrum, Loopring, and Zksync - are changing the game for Ethereum scaling and also discuss:
Domain Name Protocol Partners with MoonPay, and
A short story about Cryptopunk 6166 NFT.
📻 Podcast of the Week
The Bankless Africa Podcast of the Week: Zambia x Crypto Regulation | Block partners with Yellow Card | LazerPay folds | Muru’s Drive and on the fireside chat, Crypto & Ethical Finance: Creating a Sustainable win-win Relationships with Caiz CEO - Philippe Theunissen.
Zambia is set to complete its cryptocurrency regulation test by June 2023. Update on Block partnership with Yellow Card and LazerPay status. Web3 economy in Africa is gaining more traction through defi-based platforms. Again, Miss Purple, our amazing host bring to your doorstep an insightful conversation on Crypto & Ethical Finance with the CEO of Caiz.
Top Layer2 Scaling Solutions
Lately, considerable conversations have been going on around layer2 scaling solutions, especially in the DAOs and Twitter. This is because Layer2 solutions are here to solve the problem of blockchain scalability. Layer2 is designed to enhance the performance of Ethereum by building on top of the existing blockchain. They also offer a range of solutions that can help to improve the speed, security, and cost-effectiveness of transactions. As a result of this, many DAOs are switching to Layer2 blockchain deployment.
Optimism is a Layer2 scaling solution for Ethereum that uses optimistic rollups. Optimistic rollups bundle multiple transactions into one transaction, reducing the computational load on the leading Ethereum network. Optimism is simple and easy to use, which makes it accessible to a wide range of users. It reduces gas fees, making transactions more cost-effective for users and offers fast transaction speeds, with transactions settling in just a few minutes. Its native token is $OP which gives users access to participate in its DAO — known as Optimism Collective — governance.
Optimism is also highly secure. The network uses the security of the Ethereum blockchain to ensure the integrity of transactions, making it a secure and reliable option for users. Overall, Optimism is a promising Layer2 scaling solution for Ethereum that offers significant benefits for users.
Polygon, formerly known as Matic Network, is a Layer2 scaling solution for Ethereum that uses sidechains for off-chain computation. Polygon is designed to be scalable, fast, and interoperable, making it a popular choice for developers and users. One of the primary benefits of Polygon is its low gas fees. By offloading many of the computational tasks to a separate network, Polygon significantly reduces gas fees, making transactions more cost-effective for users. Polygon also offers fast transaction speeds, with transactions settling in just a few seconds.
Polygon is also highly interoperable. The network allows for easy integration with other blockchains, making it possible for developers to create cross-chain applications and making Polygon a versatile and flexible solution for users.
Arbitrum is a Layer 2 scaling solution created to address the scalability issues of Ethereum. It is a trustless, permissionless solution that allows developers to create smart contracts that can be executed off-chain, which reduces the load on the Ethereum network. Arbitrum uses optimistic rollups, which allow developers to create smart contracts that can be executed off-chain.
When a transaction occurs, the network and proof are generated. After that, the Ethereum network receives this proof and verifies it. The transaction is then added to the Ethereum blockchain once the proof is verified. This process reduces the load on the Ethereum network, making transactions faster and more efficient. Arbitrum offers several benefits to users including scalability, and low gas fees — making it a cost-efficient solution for users, compatibility and security.
Loopring is a Layer 2 scaling solution that uses a technology called zkRollups to enable off-chain transactions. It is also a trustless, permissionless solution that allows users to control their funds without the need for a third party. Loopring is designed to be a decentralized exchange, which means that users can trade cryptocurrencies at a low cost and extremely fast without the need for a central authority. This makes it an attractive option for those who value decentralization and security.
Overall, Loopring gives users high-speed transactions, decentralization, security and low gas fees.
Zksync is a Layer2 scaling solution for Ethereum that uses zero-knowledge proofs to enable off-chain transactions and ensures that transactions are private and secure. When a user wants to make a transaction, they create proof that verifies the validity of the transaction without revealing the details of the transaction. This proof is then submitted to the Zksync network, where it is validated by the network's validators. Once the proof is verified, the transaction is added to the Zksync network. This process reduces the load on the Ethereum network, making transactions faster and more efficient. Zksync offers cheap gas fees and fast transactions without sacrificing security. Zksync can handle up to 2,000 transactions per second, which is significantly higher than Ethereum's current capacity.
As Layer2 scaling solutions are being developed and adopted, we can expect to see increased innovation and growth in the Ethereum ecosystem.
Bonus: Domain Name Protocol Partners with MoonPay
The Ethereum Name Service (ENS) has partnered with MoonPay, a web3 payment service to enable the purchase of .eth domain names using fiat currency instead of cryptocurrencies.
Going for Consensus2023? I have got something for you! Check out the event agenda and have fun.
🥁 African Adage
Adage: “Agbôr dî láye gpa”
Meaning: A good man begets good fruit. Layer 2 solutions are likened to good men with an intention to yield good results.
Q: Is there a Bankless Africa pidgin parlour newsletter?
😂 Just for Laughs
🔎 Community updates
📻 Bankless Africa Podcast: Zambi x Crypto Regulation | Block partners with Yellow Card and Creating a Sustainable win-win Relationship with Caiz CEO
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🎧 Check out our Pidgin Parlor podcast: Wetin’ be Optimistic and ZK rollups? With Victor and Aishat
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That's a wrap!
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Disclaimer: This post does not contain financial advice, only educational information. By reading this article, you agree and affirm the above, as well as that you are not being solicited to make a financial decision, and you in no way are receiving any fiduciary projection, promise, or tacit inference of your ability to achieve financial gains.