Why zkSync’s ZK Stack series (Part 1): GRVT’s solution to scalability and low latency

Why zkSync’s ZK Stack series (Part 1): GRVT’s solution to scalability and low latency

GRVT’s collaboration with zkSync goes beyond the limitations of traditional layers. Operating as a hyperchain, built using zkSync’s modular ZK Stack, marks our commitment to drive innovation forward for GRVT and the broader crypto community.

What are hyperchains and ZK Stack?

  • Hyperchain: Think of hyperchains as connected sovereign ZK-chains within the zkSync universe. They are custom-made, highly scalable, and fully independent, while tapping into zkSync for security and finality.
  • ZK Stack: Picture the ZK Stack as the ultimate toolkit for building these hyperchains. It is packed with what developers need to create and innovate within the zkSync ecosystem.
Gray lines show proofs, orange lines the hyperbridges, which automatically connect all blue chains. (source: zkSync)

Why GRVT chooses to build the first hyperchain

Our product philosophy at GRVT: performance meets safety and privacy. Let’s break down the key advantages of using zkSync’s ZK Stack: 

  • Part 1. Scalability and Low Latency in Trading: Customized scaling allows us to tailor technology specifically for trading applications, ensuring swift and efficient transaction processing. Our focus on low latency is crucial in trading, where every millisecond counts.
  • Part 2. Trustless and Privacy through Validium: Validiums acts like secret-keepers of the blockchain world, employing special cryptographic methods (e.g. ZK-SNARKs) to verify transactions. At the same time, they maintain privacy by keeping some data off-chain.
  • Part 3. Customization with hyperchains: Besides being fast and private, GRVT’s hyperchain is highly flexible. This allows seamless integration with diverse blockchain applications, enhancing the overall trading experience.

In Part 1 of our “Why zkSync’s ZK Stack” series, we will explore the importance of scalability and how GRVT is steering towards low latency. 

GRVT tackles scalability and low latency:
Every millisecond counts in the crypto trading race

In the world of crypto exchanges, speed matters. Traders can measure this by transaction latency. For the high-frequency trading community, low latency is more than just a hassle. How it affects trade execution:

  • Potential delayed orders
  • Unfavorable prices
  • Higher costs

These issues are especially critical for automated trading and large order executions, where even a slight delay can result in missed opportunities. 

While institutions are tentatively exploring ETFs for Bitcoin and Ethereum, they remain largely hesitant about venturing into crypto derivatives trading. Institutions seek a rare blend: high speed with the security of a trustless crypto system.

If you're interested in delving deeper into GRVT's product philosophy, particularly regarding latency, dive into these articles: 

GRVT's Strategic Move with ZK Stack

Ethereum, currently processing around 12 transactions per second, must scale to handle a vast amount of transactions for a global on-chain future. Envisioning a future where millions of transactions per second are the norm, GRVT’s strategic adoption of zkSync’s ZK Stack to build a hyperchain is a step towards this reality. 

GRVT envisions hybrid exchanges (HEXs) as a prime solution. zkSync’s modular ZK Stack helps us tackle major issues with scalability and low latency. Importantly, all these are accomplished without compromising self-custody. 

Two key feats that we have achieved:

  1. On-chain settlement speed: GRVT settles trades 60 times faster than leading DEXs
  2. Off-chain matching engine: GRVT handles 3,000 times more volume than the on-chain engine

This unique capacity positions our platform as the optimal choice for high-frequency trading. GRVT has three selection criterias when it comes to building an optimal exchange for high-frequency trading.

1. Inevitable transition from Optimistic to ZK-rollups

As the market rushed towards perpetual DEXs on Optimistic rollups last year, GRVT has opted for a more deliberate approach. Instead of following trends, we see a ZK stack as a superior long-term solution.

An Incomplete Guide to Rollups, 2021

Ethereum co-founder Vitalik Buterin has remarked that ZK-rollups will eventually beat Optimistic rollups, currently predominant in Ethereum. Unlike Optimistic rollups, ZK-rollups are faster and more secure.

With the first ZK-rollup taking four years to develop, the progression to Layer 3 is set to be faster. For GRVT, our choice to build with ZK-rollups is simple. It is about building into the future of limitless speed and minimal latency. 

2. Maximizing zkEVM Performance with Type4

Among the zkEVM options, zkSync’s hyperchain is GRVT’s choice as it meets our strict criteria for secure, user-friendly, and scalable institutional-grade trading. 

Vitalik Buterin categorizes ZK-rollups into four types, each representing different technical methods within the ZK-rollup framework. This classification does not imply performance rankings but highlights unique approaches.

Our reason is grounded in technology. zkSync is a Type 4 zkEVM distinguished for its exceptional performance. Derived from high-level code, it significantly reduces overhead and costs.

With zkSync’s efficiency, GRVT is able to securely operate a high-performance order book. This approach blends the strengths of centralized order books and decentralized settlements for an optimal balance of efficiency and security. 

GRVT users will be able to have a premier trading experience with institutional-grade capabilities. Key features to highlight:

  • A 600k TPS trade matching system
  • Up to 200 TPS of on-chain settlement

3. Tackling Compatibility Challenges

While building on zkSync’s hyperchain, GRVT has identified three distinct advantages:

With technical support from the Matter Labs team, GRVT is gearing up to launch its mainnet in the first half of 2024.
  1. EVM & Solidity Compatibility: zkSync is compatible with Solidity, creating a developer-friendly environment familiar to those versed in Ethereum’s primary programming language.
  2. Anticipated Compatibility Growth: zkSync is gearing up for gradual enhancements, aiming for a 'Step 1 level' compatibility within its ecosystem. Lambda’s involvement is set to add further advantages with more seamless integrations and broader application possibilities.
  3. Open Source & Decentralized: hyperchain is an open-source platform, granting developers free access and full ownership. Builders are able to adapt and modify the code according to their needs, encouraging diverse contributions and advances.  

The advantages of zkSync’s hyperchain go far beyond speed. In our next series, we will delve into how hyperchain’s Validium technology balances performance with security and privacy. 

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