Rollups
Sovereign Assets • Layer 1s • Payment Networks
batched transaction compression
Rollups are a Layer 2 scaling solution that bundle or “roll up” many transactions off-chain and then submit a single, compressed proof or summary of those transactions to a Layer 1 Protocol. This process drastically reduces congestion, lowers transaction costs, and leverages the security of the main chain. Rollups can be either optimistic (assuming transactions are valid unless challenged) or zero-knowledge (using cryptographic proofs for instant validation), making them a powerful tool for blockchain scalability.
Use Case: Platforms like Optimism and Arbitrum use rollups to enable thousands of transactions per second on Ethereum, offering fast, low-cost user experiences while inheriting Ethereum’s security.
Key Concepts:
- Layer One Protocol — The base blockchain where rollup proofs are ultimately posted and finalized
- Layer Two Protocol — Networks built on Layer 1 to process transactions more efficiently, including rollups
- Settlement Finality — Ensures that once a rollup proof is posted to Layer 1, all bundled transactions are considered final
- Throughput — Rollups significantly increase the number of transactions per second compared to Layer 1 alone
- Sidechains — Alternative scaling methods to rollups, using independent chains linked to Layer 1
Summary: Rollups are an essential component of blockchain scaling, allowing networks to process massive numbers of transactions with minimal cost, all while preserving the decentralization and security of the underlying Layer 1 protocol.