Zk Compression vs. Zk Rollups: Understanding Solana and Ethereum Scaling Solutions

Scalability remains a significant challenge in the blockchain space as networks grow to accommodate increasing transaction volumes and decentralized applications. Among the cutting-edge solutions addressing this issue, zk based technologies have gained considerable attention for their ability to enhance efficiency and reduce costs — particularly zk Compression and zk Rollups. On platforms like Solana and Ethereum, zk innovations are paving the way for more scalable and user-friendly ecosystems, offering groundbreaking methods to handle the demands of modern decentralized systems.

If you are unfamiliar with what the zk technology is, no problem. We got you!

What is zk?

Zero knowledge (zk) technology is a cryptographic method designed to enhance privacy and security in digital systems. At its core, ZK technology allows one party to confirm the validity of a statement to another party without disclosing any additional information beyond the truth of the statement itself. This ability to verify without revealing sensitive details makes ZK technology a powerful tool for safeguarding digital interactions — improving the privacy as well as scalability of blockchain networks.

Why is Scalability Important for Blockchains?

Scalability is an important factor for blockchain networks to achieve mainstream adoption and compete with traditional financial systems. Currently, blockchains like Bitcoin and Ethereum face significant limitations in their ability to process transactions. For instance, Ethereum handles approximately 15 TPS (transactions per second) while Solana handles around 800 TPS. Although there is a huge jump in the TPS metric with Solana, traditional systems are still way ahead. Visa can process about 24,000 TPS while Mastercard can effortlessly handle about 5000 TPS. This stark difference highlights the need for blockchains to scale effectively.

The blockchain TPS numbers mentioned earlier were real time stats from the past 30 days from chainspect. More more details click here.

Without scalability, blockchain networks struggle to handle increasing transaction volumes. As more users and decentralized applications (DApps) join a network, the limited capacity of the blockchain creates a bottleneck. This means that the system cannot process transactions quickly enough to meet the user demand, resulting in slower processing times and higher transaction fees.

For example, when demand spikes during high traffic periods — such as during the launch of a new NFT project or a surge in DeFi activity — users may experience delays in transaction confirmations. Additionally, because the blockchain’s capacity is limited, users often compete to have their transactions processed faster by offering higher fees. This bidding war inflates transaction costs, making the network less affordable and accessible, particularly for the ordinary layman.

This inefficiency restricts the usability of blockchain networks for everyday tasks like payments, trading, or running DApps. Without scalability solutions, blockchains cannot provide the speed, cost-effectiveness, and reliability required to compete with traditional financial giants like Visa or Mastercard, nor can they support the global scale needed for mass adoption.

Benefits of Increased Scalability

1. Increased Throughput
   Scalability solutions enhance the capacity of blockchain networks to process a higher volume of transactions per second. This is essential for supporting the growth of decentralized applications (DApps) and maintaining a seamless user experience.
2. Lower Transaction Costs
   By increasing network efficiency, scalability reduces transaction fees, making blockchain technology more accessible and practical for a broader audience.
3. Improved Usability
   Scalability ensures faster transaction confirmations, which are critical for user satisfaction and the adoption of blockchain-based platforms in real-world applications.
4. Support for Mass Adoption
   To compete with traditional financial systems, blockchains need to offer the same level of speed and efficiency. Scaling solutions help bridge this gap, making blockchain technology viable for global use.

So recently, Ethereum and Solana have taken steps to tackle these scalability challenges through advanced Zk based technologies. Ethereum employs zk Rollups, while Solana leverages zk Compression, each offering unique solutions to improve transaction efficiency and reduce costs. Let’s explore these concepts in more detail.

What is Zk Compression?

ZK Compression is a groundbreaking technology launched on Solana’s mainnet in September 2023. Announced via Solana’s official channels, this innovative feature represents a significant step forward in scalability and cost-efficiency for developers. By leveraging zero-knowledge (ZK) proofs and advanced compression techniques, ZK Compression enables developers to build large-scale applications while significantly reducing the cost of storing and managing on-chain state. In fact, it has been shown to reduce costs by a factor of 1,000, making it an attractive solution for developers looking to scale their applications on Solana’s Layer 1 (L1) network.

How does it work?

ZK Compression operates by allowing developers and users to compress on-chain state data, drastically reducing storage costs without compromising Solana’s hallmark features—security, performance, and composability. Here’s how it achieves this:

Compression
Instead of storing the entire dataset on the more expensive on-chain account space, ZK Compression saves only the state roots (small fingerprints summarizing the compressed data) in on-chain accounts. The underlying data is moved to Solana’s cheaper ledger space, drastically cutting costs while maintaining data accessibility and integrity.

Zero-Knowledge Proofs (ZK)
ZK Compression uses small validity proofs to ensure the integrity of the compressed state. These proofs are generated under the hood and can be fetched from Remote Procedure Call (RPC) providers that support ZK Compression, ensuring data authenticity without requiring users or developers to manage the complexity.

Key Features of ZK Compression

• Minimal State Costs
  By utilizing cheaper ledger space for storing data, ZK Compression significantly reduces the costs associated with on-chain state. For example:
  • Creating a 100-byte PDA (Program Derived Address) Account:
    • Regular Account: ~0.0016 SOL
    • Compressed Account: ~0.00001 SOL (160x cheaper)
  • Creating 100 Token Accounts:
    • Regular Account: ~0.2 SOL
    • Compressed Account: ~0.00004 SOL (5000x cheaper)
• L1 Security and Performance
  The execution and data availability for zk Compression remain on Solana’s Layer 1, preserving the network’s high security and performance standards. This ensures that developers can scale applications without sacrificing reliability or speed.
• Composability
  zk Compression seamlessly integrates with Solana’s ecosystem, allowing developers to mix and match between compressed and regular on-chain states. This enables atomic interactions with multiple programs, accounts, and compressed accounts, maintaining flexibility in application design.

By reducing state costs while retaining Solana’s Layer 1 security guarantees, ZK Compression offers unparalleled advantages for developers aiming to scale their applications. It ensures that even large-scale projects with millions of users remain cost effective, while maintaining the performance and composability that Solana is known for. With its innovative combination of compression techniques and zero-knowledge proofs, ZK Compression is poised to set new benchmarks in blockchain scalability, making Solana an even more attractive platform for developers seeking to build the future of decentralized applications.

What is zk Rollups?

Zero-knowledge rollups, or zk Rollups, are a layer 2 scaling solution designed to improve the scalability, efficiency, and cost-effectiveness of blockchain networks, particularly Ethereum. By utilizing advanced cryptographic techniques known as zero-knowledge proofs, zk Rollups process transactions off-chain while maintaining the security and data integrity of the layer 1 network.

Zk Rollups combine multiple transactions into a single proof, known as a zk-SNARK (Zero-Knowledge Succinct Non-Interactive Argument of Knowledge), which verifies the validity of these transactions without revealing sensitive details. This proof is then submitted to the layer 1 blockchain, significantly reducing the computational and storage load on the mainnet.

How does it work?

Zk Rollups operate by moving most of the computational work off-chain and only relying on the base layer for security and final settlement. Here’s how the process works:

1. Batching Transactions
   Transactions are grouped into batches off-chain, consolidating multiple operations into a single bundle.
2. Generating zk-SNARK Proofs
   For each batch, a zk-SNARK proof is generated, which mathematically verifies that all transactions within the batch are valid without needing to reveal the individual transaction details.
3. Submitting to the Mainnet
   The transaction batch, along with its zk-SNARK proof, is periodically submitted to Ethereum’s mainnet.
4. On-Chain Verification
   Instead of verifying each transaction individually, the Ethereum network only verifies the zk-SNARK proof. This drastically reduces the amount of data processed and stored on-chain.
5. Security Through Layer 1
   The proof is verified on-chain, allowing zk Rollups to inherit the security, data availability, and censorship resistance of the Ethereum mainnet.

Key Features of zk Rollups

Zk Rollups bring several notable benefits to blockchain scalability and usability:

• Scalability
  By processing transactions off-chain and submitting only aggregated proofs to the mainnet, zk Rollups significantly increase the number of transactions per second (TPS) that Ethereum can handle.
• Cost Efficiency
  With less data to store and verify on-chain, zk Rollups drastically lower transaction fees, making Ethereum more accessible for users.
• Security
  Zk Rollups rely on the Ethereum mainnet for data availability and settlement, ensuring that all transactions inherit Ethereum’s robust security and decentralization.
• Reduced Latency
  Since most computations occur off-chain, transactions achieve faster finality times compared to traditional on-chain processing.

Zk Rollups are pivotal for Ethereum’s scalability roadmap. By enabling high transaction throughput without compromising security or decentralization, they allow Ethereum to remain competitive as blockchain adoption grows. Whether used for decentralized finance (DeFi), gaming, or NFT marketplaces, zk Rollups offer a cost-effective and efficient solution to Ethereum’s scalability challenges, paving the way for a more accessible and scalable blockchain ecosystem.

zk Compression vs. zk Rollups

Whether its zk Compression on Ethereum or zk Rollups on Solana, the potential of each technology depends heavily on its intended application. zk Rollups on Ethereum are optimal for projects that require robust security and wish to leverage Ethereum’s extensive ecosystem. They provide a well supported method to scale Ethereum while preserving its decentralized nature. On the other hand, zk Compression on Solana is best suited for applications with performance, speed, and cost-effectiveness as their main priority. By taking advantage of Solana’s high transaction throughput, zk Compression offers a novel method to scale while minimizing storage costs and maintaining efficiency.

The table below highlights the key differences between zk Rollups on Ethereum and zk Compression on Solana, showcasing how each solution is tailored to the unique strengths and challenges of its respective platform.

Aspect	zk Rollups	zk Compression
Execution and State Management	Execute transactions off-chain and submit proofs to Ethereum’s mainnet.	Compresses state data on Solana and stores minimal information on-chain.
On-Chain Data Handling	Store transaction data in batches on Ethereum.	Store only the state root on-chain, with detailed data off-chain.
Privacy and Integrity	Use zk-SNARKs for transaction validity without revealing data.	Use zk proofs to ensure data integrity while keeping storage efficient.
Nature of Solution	Layer 2 scaling solution for Ethereum.	On-chain optimization for Solana.

Conclusion

Blockchain scalability is a critical challenge that must be addressed for decentralized technologies to achieve mainstream adoption. Innovations like zk Rollups on Ethereum and zk Compression on Solana highlight how advanced cryptographic solutions can transform the scalability landscape while maintaining the unique strengths of their respective networks.

Zk Rollups tackle Ethereum’s transaction bottlenecks by batching and verifying transactions off-chain, significantly improving throughput without compromising security. Meanwhile, zk Compression revolutionizes Solana’s data management by enabling state compression, drastically reducing costs while preserving the high performance and composability of its Layer 1 network.

Together, these technologies exemplify how blockchain ecosystems are evolving to meet the demands of users and developers. Whether it’s Ethereum’s focus on security and decentralization or Solana’s commitment to speed and cost efficiency, zk-based solutions are paving the way for scalable, accessible, and future-ready blockchain platforms. As these advancements continue to mature, they will play a vital role in enabling blockchains to compete with traditional systems and power the next generation of decentralized applications.

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Ethereum

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