Background and Challenges

Rollup solutions are a type of layer 2 scaling solution for blockchains, designed to improve scalability and reduce transaction costs. They work by aggregating multiple transactions off-chain and then submitting a single summary transaction, or "rollup," to the main blockchain. This allows for more transactions to be processed off-chain, significantly increasing throughput while still benefiting from the security guarantees of the main blockchain.

Rollups come in two main flavors: optimistic rollups and zk-rollups.

• Optimistic Rollups: These rollups rely on a dispute resolution mechanism to ensure the validity of transactions. Transactions are processed off-chain, and only in the case of a dispute are they validated on-chain. While optimistic rollups offer high scalability and relatively low costs, they can be susceptible to certain types of attacks if the dispute resolution process is not well-designed.

• zk-Rollups: zk-Rollups use zero-knowledge proofs to ensure the validity of transactions without the need for dispute resolution. This allows for a higher level of security and privacy compared to optimistic rollups. However, zk-rollups typically have higher upfront costs due to the computational overhead of generating and verifying zero-knowledge proofs.

Identification of Centralization Challenges within Existing Rollup Models

Despite their scalability benefits, existing rollup models often face challenges related to centralization. These challenges include:

• Centralized Sequencers: Many rollup solutions rely on centralized sequencers to order and validate transactions. This introduces a single point of failure and undermines the decentralization goals of blockchain technology.

• Dependency on Main Chain: Rollup solutions are often dependent on the main blockchain for security and finality. This can lead to delays and increased costs if the main chain experiences congestion or other issues.

• Limited Interoperability: Existing rollup models may have limited interoperability with other rollups or blockchain networks. This can hinder the seamless transfer of assets and data between different systems, limiting the overall scalability and utility of rollup solutions.

• Governance and Control: Centralized control over rollup solutions can lead to governance issues and potential censorship or manipulation of transactions. This undermines the trust and transparency that blockchain technology aims to provide.