Cancun is about to upgrade. How does Metis make Layer 2 truly "decentralized"?

The L2 track has shown a trend of decentralization and merger and integration.

Written by: Shenchao TechFlow

Guess the riddle of an encryption project, “MEME in L2, L2 in MEME.” You may see through it at a glance, it is the currently popular Ethereum ecosystem Layer2Metis.

According to L2 Beat data, this L2 project, which is participated by Vitalik’s mother Natalia Ameline and mother’s best friend Elena Sinelnikova, currently has a TVL of more than 500 million US dollars, an increase of 416%, and has ranked among the top four of Ethereum Layer 2. With the soaring TVL, the currency price It skyrocketed simultaneously, rising more than 300% in 30 days.

What is the driving force behind Metis TVL and the currency price spiral?

As the “Cancun Upgrade” of Ethereum in the first quarter of 2024 approaches, Layer 2 projects are competing to enter the “range” of investors. Compared with large-scale L2s such as Arbtrum and Optimism, which have a circulating market value of US$3 billion, the market value is only 3 The US$100 million Metis is more cost-effective in the eyes of investors. Secondly, Metis has its own specialty-decentralized sorter.

The design architecture of Layer 2, the mainstream of the existing Ethereum ecosystem, is to outsource the computing requirements of smart contracts to external servers, and finally hand over the results (fraud proof or zero-knowledge proof) to Ethereum for settlement.

This server, also known as the Sequencer, receives unordered transactions from users, processes them into groups outside the chain, and then generates a batch of compressed ordered transactions, which are then sent to Ethereum. It can be said that the sequencer is The soul of L2.

A cruel fact is that the current mainstream Layer 2, including Arbitrum, Optimism, etc., currently run the network with a centralized sorter. The reason is very simple. It is most convenient, user-friendly and more cost-effective to run your own unique centralized sorter. Low.

However, this is not in line with the decentralized spirit that cryptocurrency has always advertised. On the other hand, it also brings about issues such as whether the sequencer will do evil, insert transactions, and MEV.

Metis has decided to make a breakthrough in the field of decentralized sorters. It will soon test the decentralized PoS sorter on the Sepolia test network and start community testing on January 3, 2024.

At a time when centralized sorters are hard to come back from, will Metis take the lead in launching a general attack on decentralized sorters? Will it be able to speed up the process of decentralized sorters on the L2 track and set off a new round of innovation boom?

This article aims to compare L2 track projects from two major dimensions, technical and ecological, by taking Metis’ technological innovation points and ecological construction ideas as the starting point, so as to explore the future opportunities and challenges of the L2 track.

The first decentralized POS sequencer: Staking incentive mechanism injects internal driving force into operation

It is no exaggeration to say that the centralization problem of sequencers has reached the point of being irreversible in the L2 track.

On the one hand, most L2s currently run centralized sorters, and their attitude towards implementing decentralized sorters is ambiguous: OP Foundation and Arbitrum Foundation both run their own centralized sorters, although they have each proposed decentralization. However, due to the lower threshold and cost of operating and maintaining a centralized sorter, as well as the considerable benefits brought by running a centralized sorter, the development of decentralized sorters is extremely slow.

On the other hand, it is urgent to promote the implementation of decentralized sorters: centralized sorters not only run counter to the original intention of blockchain decentralization, but also have huge hidden dangers. Once there is a failure or attack, the entire L2 will be involved. In addition, the sequencer determines the order, content and structure of the packaged transactions. It is entirely possible for the centralized sequencer to do evil to maximize its own arbitrage opportunities, seize MEV value, or even completely censor A space for users to trade.

It is true that profit-seeking human nature is difficult to change. Therefore, the design of a decentralized sorter must not only have an insight into the market, but also human nature: firmly grasping the profit-seeking human nature and designing solutions will ensure that the decentralized sorter can operate stably and well in the long term. of inexhaustible internal drive.

Metis’ decentralized PoS sequencer solution that introduces the Staking mechanism is the existence of such an underlying technology guarantee + incentive system guarantee.

In the design of Metis, there is first the role of an administrator (Admin): as the name suggests, the administrator is a rule maker, responsible for setting important parameters in the decentralized system, including including qualified sorters into the sorter pool, Set the release rate of block rewards, etc.

The sequencer entering the sequencer pool is responsible for determining the order, content and structure of the packaged transaction. When there are multiple sequencers, at least 2/3 of the sequencer signatures are required to submit the packaged batch to the Rollup contract on L1.

In addition, in order to prevent the sequencer from doing evil, there is also a validator role that performs sample verification on the blocks, including whether the order of transactions has been exchanged, whether there have been malicious transactions inserted, etc.

The whole process can be simply analogized to: the teaching director (administrator) selects a group of teachers who meet the requirements to become question teachers (sequencers) according to the requirements, forms the test paper questions and submits them to the school, and with the signature and approval of 2/3 teachers The standard answers to the test questions that are recognized by everyone are formed. In addition, the supervising teachers will also randomly check the teachers who wrote the questions to supervise whether they have any violations such as leaking questions.

Metis decentralized PoS sequencer operation diagram

This solution in which the sequencer is run by multiple entities achieves true decentralization, allowing us to see Metis’ insight into and timely response to market needs. But another question to think about is:

Decentralization comes from consensus formed through extensive participation, so what is the motivation to attract more people to participate?

The answer given by Metis is the Staking system incentive.

First of all, the sorter operator who enters the sorter pool needs to pledge at least 20,000 METIS, and after entering the sorter pool, participating in the block sorter will receive a large number of token rewards. This 20,000 METIS threshold setting has multiple positive meanings:

• In terms of stable operation of the system: On the one hand, it aims to check whether the sequencer has the ability to participate in network operation normally. On the other hand, it also serves as a deterrent. If the sequencer does evil, otherwise the pledged assets will be confiscated.
• In terms of ecological development: At present, the application scenarios of L2 tokens are limited. On the one hand, the setting of the pledge mechanism increases the utility of METIS tokens. On the other hand, it also further reduces the already limited circulation of METIS, thus affecting the ecological development. A virtuous cycle creates a very positive catalytic effect.

For the verifier, the verification block itself can obtain token rewards. In addition, once the sorter is found to have done evil, part of the assets confiscated by the sorter will be rewarded to the verifier, which also invisibly enhances the verifier’s ability to pass Validate your drive to earn more.

In terms of attracting wider participation, the Metis ecosystem will also give birth to some Staking dApps to serve more ordinary users who do not have enough funds to enter the sorter pool. They can pledge their tokens to trustworthy sorter operators to earn money. To obtain revenue, and if the sorter operator wants to obtain more staking support, it needs to use part of the revenue to support its users.

As a result, a stable decentralized sorter operating framework with widespread participation, transparent supervision, and benefits for every participant is ready to emerge.

In addition to incentives, Metis’ practice of introducing the Staking mechanism also led us to further explore the practicality of L2’s native tokens: For a long time, the application scenarios of L2’s native tokens have been hovering within the scope of governance, which has also made many people question L2 The necessity of the existence of native tokens and how to give L2 native tokens more utility has become a problem that troubles many project parties. By introducing Staking into the decentralized POS sequencer mechanism, Metis not only plays an incentive role, but also integrates token utility into consensus and network security.

Of course, this set of designs is still in the theoretical stage at present, but it will soon be tested by the community. On December 27, 2023, Metis will test the decentralized PoS sequencer on the Sepolia test network and start community testing on January 3, 2024. Users will earn points by testing dApps, Learn to Earn, etc., with different points levels Different types of NFT can be obtained, and finally community test airdrops can be obtained with NFT.

Metis encourages the community to participate extensively in order to better test the robustness of the network, find out and fill in the gaps, and promote the further improvement of the decentralized POS sorter solution.

Hybrid Rollups: In OP VS ZK melee, you can have your cake and eat it too.

Of course, in the fierce L2 competition, Metis’s innovation is not only the decentralized PoS sequencer, Hybrid Rollups are also worthy of in-depth study.

Looking back on the development of the L2 track in the past two years, OP has taken advantage of the open source technology stack and derivative projects have blossomed everywhere, and the airdrop gameplay has set off multiple rounds of community craze; ZK’s advantage lies in more rigorous mathematical proofs and higher security, and also has zkSync, Starkware Projects such as Optimism and Arbitrum can compete with Optimism and Arbitrum; other new projects are almost all derived from OP series and ZK series technical solutions. This inevitably brings about the problem of homogenization of L2 project technology, and also makes OP series The respective technical shortcomings of the ZK series are highlighted in a wider range of project samples:

• Optimistic Rollups are fully compatible with EVM, and off-chain transaction processing is faster and cheaper. However, because the OP assumes that the transaction is valid by default, there are security risks. In addition, due to the set challenge period to submit fraud proof, the time for the transaction to be finalized is longer;
• ZK Rollups’ verification method based on zero-knowledge proof has higher security and no challenge period. Transactions can be finalized faster, but its EVM compatibility is difficult to achieve, and generating proofs requires higher off-chain computing costs. .

Image source: Metis Medium

In the repeated trade-offs between safety and efficiency, the two competing factions began to seek integration and learn from each other’s strengths. Hybrid Rollups came into being and gradually became the future trend of L2 in the eyes of many practitioners. There are also many projects based on The characteristics of its own projects have opened the way to explore Hybrid Rollups: for example, in July this year, the mixed algorithm stablecoin protocol Frax Finance launched the Layer 2 network Fraxchain, which is a typical representative of Hybrid Rollups; in addition, the lightweight blockchain protocol Mina will also launch its Layer 2 network Fraxchain based on The zero-knowledge proof technology built by MIPS zkVM is used in OP Stack fraud proof, etc.

This inclusive trend also impressed Metis. As early as March 2023, Metis focused on Hybrid Rollups in its publicly released roadmap.

While retaining the Optimistic Rollup architecture, this mechanism introduces Zero Knowledge fraud-proof (ZKFP for short). Compared with traditional fraud prevention mechanisms that require re-execution of all transactions, ZKFP only needs to submit a single ZK certificate to prove Rollup. Checking a single ZK certificate makes it easier, lower cost, and more efficient to process and verify transactions.

During the entire operation process: after the sequencer generates the block, the Proposer submits the transaction and status, and then the Prover reads the data from L1 to generate the block and MIPS program. After the proof is generated, Prover submits the proof to L1: if it is not submitted or the smart contract determines that the conditions are not met, the verifier will start the anti-fraud process, and the tokens pledged by the sequencer may be forfeited.

Metis Hybrid Rollups operation diagram

In terms of specific implementation ideas, Metis integrated the MIPS instruction set in the design of Hybrid Rollups.

Since the EVM instruction set introduces new commands and deprecates old commands over time, this change is very challenging for any developer who wants to build and use a standardized instruction set, so Metis chose to do it on the basis of MIP Optimized to form a customized zkMIPS specifically for ZK proof. Compared with traditional ZK proof integration, zkMIPS can also create recursive proofs, allowing multiple proofs to be aggregated into a more manageable unit, which is more efficient and lower cost.

In July this year, Metis also announced the incubation of the zkMIPS project ZKM: ZKM uses the MIPS instruction set to implement zero-knowledge proof (ZKP) security for all virtual machines (VMs) and applications from the CPU level, and supports a variety of blockchain smart contract engines. . The plug-and-play feature allows developers to apply ZKP without changing the code base, reducing adoption costs. Leveraging Ethereum’s decentralized security infrastructure, ZKM can verify all blockchain and non-blockchain transactions.

Of course, Metis also understands the importance of EVM for ecological construction: being compatible with EVM can not only attract a large number of mature Ethereum ecosystem developers to seamlessly enter the Metis ecosystem, but also allow developers to enjoy the massive practical tools, development tutorials and basics of the Ethereum ecosystem. facility. Based on this, Metis launched the Rollup solution of Metis Virtual Machine (MVM): The design of MVM is almost the same as that of EVM, but key improvements have been made, such as separating computing and storage functions. This design not only makes the Metis ecosystem oriented to the broad EVM universe Open, it also reduces gas fees and shortens withdrawal waiting times.

In this way, Metis not only retains the advantages of the OP series, achieves EVM equivalence, and provides developers with an easy coding environment, but also promotes the finality and security advantages of the ZK series, shortening the transaction finalization time from 7 days to Approximately 4 hours and greatly improved safety. For developers, Hybrid Rollups have lower barriers to entry and are more flexible; for users, Hybrid Rollups are safer and more efficient.

Compared with 2021, the current L2 technology has naturally grown and matured a lot, which is inseparable from the integrity and innovation of track innovators. As one of them, Metis’s understanding and design of decentralized sorters and Hybrid Rollups reflect its ambition to be a pioneer in L2 technology innovation and keep pace with the times. In the field of ecological construction, Metis also practices user and development Pioneers who meet the needs of investors.

Taking users as the perspective, multi-dimensional economic incentives promote the blooming of a hundred flowers in the ecosystem

The construction of Layer 2 is like building a shopping mall. The gradual implementation of technical issues is like setting up a steel frame for the shopping mall, providing a solid guarantee for the prosperity and development of the shopping mall. The main body of the transaction is the user, so the prosperity of the shopping mall depends on investment. Like attracting customers, the prosperity of L2 is also reflected in two aspects:

• How to attract more developers to enter the ecosystem, build projects and carry out continuous innovation;
• How to attract more users to enter the ecosystem, participate in the ecosystem and be interested in continuous exploration;

L2 project parties with various talents have already achieved a lot of successful experiences in practice in this battle for traffic: Optimism airdropped to thousands of people in multiple rounds, and then gradually built its super chain universe with OP Stack open source components; Arbitrum actively The introduction of leading DeFi projects, Uniswap, Aave, Curve, and 1inch, and the entry of large-scale DeFi projects brought a large number of users to Arbitrum; BASE, a Layer 2 project backed by CoinBase, launched the phenomenal application FriendTech and became an instant hit; the founder of Blur launched the Layer 2 network Blast relies on RWA native revenue gameplay to exceed 600 million TVL in 9 days…

Having been deeply involved in the L2 track for many years, Metis is well versed in the conventional gameplay of ecological customer acquisition. While following the basic strategy, it focuses on low threshold and high returns, and continuously expands the ecological territory from the two dimensions of users and developers.

For users:

Lowering the threshold for ecological entry is the first priority to attract users: therefore, every L2 project attaches great importance to the development of ecological infrastructure “wallet”, and Metis is no exception. At present, many mainstream wallets such as MetaMask, Trust Wallet, imToken, TokenPocket and OKX Web3 wallet have supported Metis. Users can easily interact with various dApps in the Metis ecosystem through their wallets without additional learning costs.

Reducing the cost of ecological participation can accumulate a good user reputation: With the ingenious design of Hybrid Rollups, the transaction experience of the Metis ecosystem is both efficient and safe. In addition, Metis integrates a decentralized storage MemoLabs, which makes its transaction fees compared with Optimism and Arbitrum. Tens of times lower, ETH transfers are less than $0.01. Although in the future, as Metis changes the DA layer to the ETH main network, transaction fees will increase, but they will still be within a low range, and transaction security will be further improved.

Image source: l2fees.info

Rich ecological participation options are the key to attracting users to stay for a long time: According to Layer2 Station data, Metis has more than 100 ecological applications, including DeFi, wallets, NFT and other sectors, including Aave, SushiSwap, Stargate, etc., which are well-known The DeFi application attracted a large number of users to Metis in the early stage of settlement, and also provided more playability for Metis ecological users.

Image source: Twitter @Layer2_Station

Interestingly, since the project name of Metis comes from Metis, the goddess of wisdom in Greek mythology, projects named after Greek goddesses are very common in the Metis ecosystem: for example, the project name of Maia, a DeFi revenue enhancer, comes from the goddess of fertility ( Ancient Greek: Μαῖα); the project name of the Dex aggregator Hera Finance comes from the Queen Hera (Greek: Ἥρα)… This interesting echo in the name is also a major memory point for community members about the Metis ecology.

In the future, Metis will continue to make efforts in ecological diversity, attract more DeFi, GameFi, SocialFi, and NFT projects to settle in, further improve the ecological landscape, and bring rich experiences to users.

To seize users’ profit-seeking psychology is to seize the traffic password: the airdrop gameplay was once the most talked about topic in the L2 community, and as early as when it was launched in 2021, Metis has conducted a large number of airdrops, and it will be launched in two weeks. The decentralized PoS sorter community test (January 2, 2024) will also provide generous rewards to community members who actively participate in the test.

In addition to airdrops, Metis also links income with ecological participation and launched the Metis Advocate Program. If any community members agree with Metis’ development philosophy and have content creation capabilities and social media influence, they can apply for the program and contribute to the development of Metis. Contribute and receive corresponding rewards.

In September this year, Metis officially announced the $5 million DeFi incentive program Metis Journey to incentivize active DeFi participants, of which 100,000 METIS tokens will be allocated to incentivize Aave users’ liquidity pool on Metis. Including ETH, METIS, USDC, USDT and DAI. A series of incentives such as this are designed to increase users’ ecological participation benefits and attract more users to enter the ecosystem.

In addition, as mentioned above, with the implementation of the decentralized PoS sequencer, ordinary users can share the benefits of block mining by pledging their tokens to the sequencer operator.

For developers:

The low technical threshold allows developers to save a lot of learning costs: by retaining the Optimistic Rollup architecture, Metis can provide EVM equivalence, and a large number of Ethereum developers can seamlessly enter the ecosystem.

Thoughtful technical services can help developers avoid many detours: Like many technically mature projects, the Metis official website displays detailed technical documents, development tutorials and related technical tools, and has established a developer exchange community to promote technical exchanges and Learn, the professional and technical personnel in the group respond in a timely manner to help new developers answer their questions.

In addition, Metis is not stingy in its financial support for developers: the bug bounty program for smart contracts on the official website is valid for a long time, with rewards of up to US$100,000 available; in addition, Metis will also conduct hackathons from time to time. , discover advantageous projects and developers, and provide financial, technical, and marketing support.

This week, Metis announced a US$100 million ecological development fund, and 4.6 million METIS were allocated to fund sequencer mining, traceability funds, deployment of new projects and other projects. The Future Fund will focus on projects in DeFi, RWA, SocialFi, NFT, cross-chain technology, smart contract development, blockchain security, decentralized identity and privacy solutions, games and other tracks to accelerate the growth of its ecosystem.

Image source: Twitter @MetisDAO

Facing 2024: welcoming multiple milestones

In the roadmap announced at the beginning of the year, the Hybrid Rollup upgrade series is also the focus of Metis. The official team revealed that ZKM will be available to everyone in the first quarter of 2024.

In addition, another important milestone for Metis is the upcoming community testing event of the decentralized PoS sequencer.

The first phase of the testing event will last for two weeks (January 3 - January 17, 2024) and is designed to encourage users to interact with Metis dApps deployed on the Sepolia testnet:

• Hummus Exchange
• Netswap
• Tethys Finance
• Native liquidity staking protocol for METIS tokens
• More…

As the first project to implement a decentralized sorter, community members who are concerned about the development of the decentralized sorter have high curiosity and expectations for this community test event. The Metis social media platform will also announce more gameplay tutorials and Reward details, in addition, the event also sets up a series of rewards, and the gameplay is also linked to airdrops. Interested users can continue to pay attention.

In the upcoming 2024, Metis’ first quarter will focus on the launch of the decentralized POS sorter; in the second quarter, Metis will accelerate the work related to the launch of Hybrid Rollup on the testnet; in the third quarter, Metis’ Common + Eco Node two-tier governance structure will be officially launched.

Looking at the Metis ecosystem as a whole: a few days ago, Metis’ TVL was still around US$240 million, the number of wallet addresses was around 470,000, and the daily active addresses on the chain were around 2,000. However, this week Metis’ TVL jumped to US$355 million. This is not only It demonstrates the positive impact of the gradual implementation of the above-mentioned milestones on Metis, and also gives the community a great deal of imagination for Metis’ accumulation and development:

On the one hand, the current quota allocated to investors and founding teams in Metis tokens has been fully unlocked, and tracking wallets on the chain can show that institutions have also started shipping. Compared with other L2 projects that still retain a large amount of institutional and team chips, Metis is an excellent investment target in the L2 track in the eyes of many KOLs.

On the other hand, with the launch of the decentralized PoS sorter, under the guidance of the incentive system, not only the sorter will choose to pledge 20,000 METIS to earn block rewards, but users will also choose to pledge tokens to share the income with the sorter. The utility of the currency will also increase, and Metis may be the first to usher in a period of rapid development.

Image source: l2beat.com

In the upcoming 2024, Metis will usher in multiple milestones, and as the ecological construction process accelerates, Metis may be able to seize the opportunity to challenge the four kings (Arb, OP, zksync, starkware) and become the first in L2 Echelon opportunities.

Conclusion

From the increasing calls for decentralized sorters and the in-depth exploration of Hybrid Rollups by many developers, it is not difficult to see that the L2 track has shown a trend of decentralization and mergers and integration.

Sail along the current and travel a thousand miles in a day. Perhaps in the current L2 competition, we also need to make smarter choices based on trends, continue to innovate with an inclusive mentality, and lead the project out of the circle while pushing the track to break through.

Extending the project name “Metis”, the ancient Greek name is: Μῆτις, which represents the goddess of wisdom in Greek mythology. On the one hand, the ingenuity of the name contains the project’s positioning and expectations for itself, and on the other hand, it may also imply Metis’ role in L2 Smart layout and choices in the competitive landscape:

Jump out of the competitive internal friction of OP series VS ZK series early, aim at Hybrid Rollups with a keen market sense, and firmly implement the concept of decentralization, providing double guarantee for the stable operation of the decentralized PoS sequencer through technology + incentives.

This wisdom also extends to the ecological aspect. It is said that the bear market is the best time to build. Metis’ ecological construction currently extends from infrastructure to various types of dApps, and the Metis ecological landscape has been gradually improved. At the current time of the bull market, Metis is about to usher in a number of breakthrough developments, and is ready to welcome the influx of users and funds in the bull market.

Of course, L2 War is just a movie that has just begun. With the arrival of a new round of bull market, in the face of market opportunities and challenges, we look forward to the performance of Metis and more innovative solutions emerging on the L2 track.