Author: LINDABELL
On May 23, Taiko announced the first round of airdrop query page, which sparked a wave of controversy in the community about fairness. In response to this, the founder of Taiko, Daniel Wang, seemed to have failed to convince the community.
Meanwhile, on May 25, Vitalik Buterin, the co-founder of Ethereum, as a block proposer on the Taiko mainnet, proposed the first block and stated in the attached note: "I am glad to see Taiko being launched as a Based Rollup platform. Ethereum benefits from adopting various L2s using different methods, and I appreciate Taiko being one of the first projects to move in this direction."
After the Cancun upgrade, the focus of the Ethereum ecosystem has once again shifted to the L2 field. Unlike other Rollup projects, Taiko is developing a solution based on Based Rollup and has attracted the favor of many VCs such as Sequoia China, Generative Ventures, Hashed, Lightspeed Faction, Token Bay Capital, and Flow Traders. It is inevitable to wonder, compared to other well-known ZK scaling projects, what makes Taiko special? How will its scaling solution affect the L2 ecosystem?
With these questions in mind, ChainFeeds interviewed the Taiko team to discuss the origin of Taiko, its vision, and Ethereum's scaling solution.
Key Excerpts:
- Taiko founder Daniel Wang hopes to expand Ethereum without sacrificing decentralization, achieving a coexistence of centralized and decentralized Layer 2 networks, allowing dApps to make decisions between the two options.
- Contestable Rollup is an abstraction of zkRollup and Optimistic Rollup. In the future, if zero-knowledge proofs become cheap enough, Contestable can be configured into a pure zkRollup.
- In the process of developing SGX proof, the Taiko team gradually realized the importance of stateless clients and firmly believes in the feasibility of running stateless clients in zkVM to generate zero-knowledge proofs in the future.
- Taiko has launched its mainnet, where block submission and proof do not require permission, but contracts still have owners. The Taiko team plans to transfer ownership of the contracts to Taiko DAO after about a year on the mainnet, completely relinquishing ownership and control of the network.
Origin of Taiko: Expanding Ethereum without sacrificing decentralization
Taiko founder Daniel Wang created the first Ethereum ecosystem DEX protocol Loopring based on ZKRollup in 2017. However, Loopring's architecture did not fully align with Daniel's vision. Daniel hoped to expand Ethereum without sacrificing decentralization, achieving a coexistence of centralized and decentralized Layer 2 networks, allowing decentralized applications to make wiser decisions between the two options. However, Loopring could only be built as a non-programmable Layer 2 network, lacking a virtual machine structure, and its block generation mechanism was also centralized in order to reduce costs.
Before founding Taiko, Daniel Wang and like-minded developers had multiple discussions, mainly focusing on two directions: decentralized social networks or the infrastructure required for decentralized social networks, "permissionless Layer 2 networks." After careful consideration, it was generally believed that venturing into the field of decentralized social networks carried higher risks, while permissionless Layer 2 networks had greater differentiation and competitive space, leading to the emergence of Taiko.
Taiko is a Type-1 zkEVM, providing the same opcodes and functionality as Ethereum, ensuring high compatibility with the existing Ethereum ecosystem. The Taiko team emphasized that Taiko's initial design was based on the structure of Based Rollup, allowing Ethereum validators to ultimately be responsible for Taiko's block generation, achieving decentralization of proposers. As of now, Taiko has over 30,000 decentralized proposers and over 14,000 decentralized validators. In March of this year, Taiko completed a $15 million Series A financing led by Lightspeed Faction, Hashed, Generative Ventures, and Token Bay Capital, with a total financing amount of $37 million. Regarding the favor of VCs, the Taiko team stated that they attach great importance to the strategic synergy between investment institutions and Taiko. In addition to the advantages of Type-1 and fully decentralized architecture, the support of investors has also played a crucial role in Taiko becoming one of the largest Discord communities globally (with over 1.07 million members) in a short period and attracting hundreds of dApps for deployment.
Exploration of Ethereum Rollup Design Framework: BCR and BBR
One of the main differences between Taiko and other Rollups is its choice of the Based Rollup mechanism, which does not rely on a centralized sequencer but depends on Ethereum validators to order transactions and blocks. Furthermore, Taiko co-founder Daniel Wang proposed the concept of "Based Contestable Rollup (BCR)" at the end of 2023. This concept introduces a Contestable mechanism because ZK-EVM code cannot be error-free forever, and Taiko is decentralized, with a low fault tolerance, thus requiring a cautious approach.
The Taiko team also outlined the main considerations for choosing the Contestable design:
- Firstly, Based Rollup, being permissionless, must introduce "higher-level proofs" to address potential bugs in the software. This avoids the necessity for a centralized network to shut down for data correction. Of course, as the Taiko network runs for a longer time, this correction mechanism can gradually be removed.
- Secondly, although SGX proof is thousands of times cheaper than zero-knowledge proofs, it is not the most ideal or decentralized way of verification. The Contestable design allows challenges to be raised when there is doubt about SGX proofs, requiring higher-level proofs to re-verify the block. This not only reduces costs but also increases the credibility of verification.
- Lastly, Contestable Rollup is flexible and scalable, serving as an abstraction of zkRollup and Optimistic Rollup. For example, if zero-knowledge proofs become cheaper in the future, Contestable Rollup can be configured into a pure zkRollup, or it can be configured into a pure Optimistic Rollup according to the needs of the application, thus adapting to different verification requirements.
Regarding the architecture of Based Contestable Rollup, Daniel Wang provided a detailed overview in the article. BCR is a Rollup with a contestable feature and Based ordering. In this design, anyone can raise a dispute about state transitions in a block, but must pay a dispute bond in Taiko tokens, and higher-level proofs are required to resolve the dispute in order to verify the block. If the challenger wins, they can reclaim the dispute bond and receive 1/4 of the original prover's validity bond. The new prover will also receive 1/4 of the original prover's validity bond as a proof fee, and the remaining 1/2 will be confiscated. Conversely, the same applies. It is worth noting that in this mechanism, multisigners collectively act as the highest level of proof in the initial years. As the highest level of proof, in this case, state transitions are considered final and no further questioning is allowed.
In addition, Taiko's BCR architecture also has a core feature that allows each level to use its own proof system. The Taiko team stated that under the architecture of Contestable Rollup, different levels of proofs can be constructed, such as the lowest-cost Optimistic proof, followed by SGX proof, and then zkEVM or zkVM proof. These different types of proofs embody the Contestable concept and can also be combined to form a hybrid multi-proof system, for example, "SGX+zkVM" can be considered a more reliable proof than using only zkVM proof.
As a significant milestone, Taiko plans to test the actual operation of BCR on the Alpha-6 testnet Katla and then launch it on the mainnet. After this, Taiko plans to either upgrade the protocol to Boosted Based Rollup (BBR) or introduce an independent BBR Layer 2 as the second major milestone. Taiko stated that to achieve native scalability for Ethereum, Boosted Based Rollup is a wise choice. By allowing L1 validators to propose new blocks for the entire network, Ethereum will gain plug-and-play scalability. For developers, BBR can shard transaction execution and storage. For users, the user experience will be enhanced as dApps will be distributed across all L2s.
Narrative Upgrade: Transitioning to ZKVM?
We are all familiar with zkEVM, but EVM was not designed to run in zero-knowledge circuits, so in practice, implementing zkEVM often requires some trade-offs. Unlike zkEVM, zkVM is a virtual machine implemented as a zero-knowledge proof system. Its advantages include: ease of use without the need to learn cryptography and ZKP systems; generality, Turing-complete ZK-VM can serve as proof computation for any calculation; simplicity, a set of simple constraints is sufficient to describe the entire VM; and the ability to use recursion, where proof verification is just another program executed on the VM.
Taiko has begun the transition from using the zkEVM model to using the zkVM model. After transitioning to the zkVM model, Taiko can modify and run a client to generate ZK proofs. To ensure robustness, Taiko diversifies encryption assumptions by building a multi-proof system and contributing to multiple zkVMs (such as RISC Zero, SP1, Powdr) and using SGX to enhance privacy and security without leaking data.
The Taiko team stated that Taiko is one of the first teams to participate in the development of the Ethereum Foundation's PSE zkEVM, and has made contributions and optimizations to critical circuits such as Keccak and Molk. However, during this process, they also realized the limitations of this development model, such as the low-level nature of the code, making it difficult to test and verify, and not user-friendly for beginners. With continuous exploration in the development of SGX proofs, the team gradually realized the importance of stateless clients and, influenced by the progress made by the Risc0 team, firmly believes in the feasibility of running stateless clients to generate zero-knowledge proofs in zkVM in the future. Currently, Taiko has collaborated with Risc0 and will continue to collaborate with SP1 and more zkVM teams to aggregate these different proof systems through Contestable Rollup, while maintaining full coupling of Taiko's Layer 2 design with each zkVM.
Furthermore, Taiko has been live on the Ethereum mainnet since the 27th, and has already processed about 15% of the data blocks across the entire Ethereum network. The team emphasized that although block submission and proof are permissionless in Stage1 mainnet mode, contracts still have owners. The team plans to transfer ownership of the contracts to Taiko DAO after about a year on the mainnet, completely relinquishing ownership and control of the network. The Taiko team also stated that they will allocate more resources to the development of Preconfirmation, MEV, and the Taiko BBR solution, hoping to bring more surprises to ecosystem projects and community users in the future.
Airdrop Controversy: Can Taiko Regain Community Confidence?
On May 23, Taiko announced the TKO token economics, stating that 5% of the initial token supply would be used for the genesis airdrop. According to the official FAQ, there will be 300,000 eligible addresses to claim over 50 million tokens. While this move was intended to reward the community, it sparked a controversy about the "fairness of the airdrop." Some community members reported receiving fewer tokens than expected, and some users claimed to have participated in related tasks but did not receive the airdrop.
In response to the community's dissatisfaction, Taiko co-founder Daniel Wang also responded, stating that Taiko's goal is fairness, but it cannot satisfy everyone, and apologized to users who did not receive TKO. However, the community seemed unconvinced by his statement. Subsequently, Daniel Wang made another response in the Discord community, stating that if someone did not receive the airdrop, it was because others scored more. As for the lack of transparency in the airdrop rules, he mentioned that transparency also cannot resolve differences, and the definition of "fairness" is highly subjective. This statement once again put Taiko at the center of public opinion, with more community members calling for a boycott of Taiko. However, it is not uncommon for airdrops to be questioned by the community, and recently released airdrop projects have experienced similar situations. Especially when airdrop gaming has become an industry and involves the participation of a large number of professional teams, they have also become part of the ecosystem, and community sentiment may be influenced by these teams. In the future, Taiko plans to conduct two more rounds of airdrops.
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