In an exclusive interview with Cryptonews Podcast’s Matt Zahab, zkLink CEO Vince Yang discussed why using blockchains is difficult and ‘painful’ and how this can be fixed.
He talked about the need for Layer 3s, why Layer 2s must succeed first, and the trends in the L3 space.
Lastly, Yang touched on zkLink’s successes, as well as the upcoming developments and partnerships.
Using Blockchains Shouldn’t Be Painful
zkLink is building Layer-3 and ZK Rollup to solve the real problems users and the blockchain space face daily, Yang said.
These include scalability, liquidity fragmentation, user experience, and general interoperability in the blockchain space.
For example, there have been thousands of new chains and roll-ups emerging rapidly over the past few years.
This requires users to understand what is going on at all times and learn how to use each of these chains.
However, this is “a little bit painful and also very difficult,” Yang said. But it shouldn’t be.
Therefore, abstraction and unification of chains are necessary.
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The Need for the Third Layer
We have just started understanding the need for Layer 2s (L2s), so what’s the point of Layer 3s (L3s)? Isn’t it too early?
To back up and explain, Layer 1 (L1) is the monolithic chain – the one on which everything else is layered. This includes Bitcoin and Ethereum, among the major ones.
L2s are built on top of the L1s to move the computation off L1s. This improves scalability, user experience, speed, and price.
However, there are problems L2s can’t solve. They are limited by their own bandwidth.
Simply put, L2s – such as Arbitrum, Optimism, and Base – have many users and hundreds of applications.
It means that these apps must compete for the total sum of the bandwidth.
When an app has thousands or millions of users, it must enable a smooth user experience. It doesn’t want to compete for the limited bandwidth that could disrupt its functions.
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However, an L3 running on top of an L2 provides “full bandwidth, full sovereignty over all the other resources for one application.” There is no sharing.
So, unlike L2s, which are typically built for general purposes, an L3 serves one specific purpose for one app.
Also, it is customizable and can be optimized for specific use cases.
There are plenty of other benefits in terms of scalability, speed, price, privacy, and regulatory compliance, Yang argued.
The Present and Future of L3s: L2s Must Succeed for L3s to Rise
To reply to the second question asked above – yes, it’s still “super early in the lifecycle or the curve of development for L3s,” Yang said. “We’re still even early in for L2s.”
Notably, he stressed that “L3s cannot emerge and successful […] without the success of L2s.”
Just a year ago, people were busy building L2s. Barely anybody spoke of L3s.
And finally, this year, many L2s launched their mainnets, becoming more mature and production-ready.
This needed to happen first for L3s to be built on top of them.
Why Liquidity Fragmentation Is A Serious Issue In Blockchain
Liquidity fragmentation significantly impacts the blockchain and DeFi ecosystems by dispersing assets and trading volumes across multiple networks and platforms, leading to isolated liquidity pools.
This fragmentation… pic.twitter.com/IuHDLTgWvQ
— zkLink | Aggregated Rollup (@zkLink_Official) May 27, 2024
On the L3 side, these products also need to be…
Read More: Vince Yang, CEO of zkLink, on the Current State of L3s