TL;DR
For DeFi to finally hit the real world and compete with TradFi, it’s crucial to address the current limitations of blockchains in terms of speed, throughput, and cost efficiency.
A robust and secure scaling infrastructure will give developers the much-needed flexibility when building new DeFi primitives and applications, ultimately driving the usability and adoption of dApps.
By leveraging zk-proofs, Scroll is driving DeFi's next big innovation cycle with a focus on user experience, efficiency, and security, giving developers and end-users unparalleled opportunities for scalability and UX.
How zk-rollups accelerate DeFi 3.0
DeFi’s next innovation cycle is being led by significant optimizations of L2 scaling platforms - orders of magnitude higher throughput and lower fees, which gives builders much-needed flexibility and ease of deployment on top of the existing DeFi primitives. Instead of stressing about technical and throughput limitations, developers can now focus on use cases and innovation. For the end-user, this translates into better LP incentives and more intuitive interfaces.
At the forefront of this ongoing shift are zk-rollups, with the accumulative TVL hitting $1.62B at the time of writing. Zk-proofs offer a radical upside compared to optimistic rollups - enhanced cryptographic security vs. relying on trust assumptions to validate data on L1. A few more advantages that are critical for the DeFi vertical:
Unmatched security: Cryptographic proofs provide an additional layer of security compared to optimistic rollups, giving liquidity providers and traders increased confidence when handling high-value assets.
Lower transaction fees: zk-rollups reduce the computational load on the underlying Layer 1 (L1) blockchain, resulting in significantly lower gas fees and cost-effective trading on DEXes.
Higher TPS: This reduces costs for users, alleviates concerns about fees, and encourages more liquidity and deeper order books - a game-changer for DeFi users engaged in high-volume trading.
Faster time to finality: By removing the withdrawal wait time, zk-rollups address the issue of canceled transactions. This is crucial for professional traders and institutions dealing with high-value assets, thus narrowing the gap between decentralized finance and TradFi.
Ultimately, those improvements bring along significantly improved capital efficiency and deeper liquidity for DeFi market participants. This opens up a range of opportunities for AMMs and LPs, including faster trading markets at much lower costs and facilitating derivative products. For the end user, DeFi 3.0 brings along improved usability and better LP incentives.
Scroll is here to unleash the next-gen DeFi
The only major limitation of ZK rollups on the market today is that most of them are not fully compatible with the Ethereum Virtual Machine (EVM), which means dApp developers have to adopt separate coding languages and frameworks to deploy their dApps on L2s. The higher entry barriers and demanding developer experience push builders to optimistic rollups despite their latency and security inefficiencies.
Scroll’s zk-EVM solves this by preserving the benefits of ZK proofs to settle transactions on Layer 1 while demonstrating EVM compatibility, setting it apart from other non-EVM native zk-rollups. Significant security and performance optimizations, along with plug-and-play deployment enable ultra-performant DeFi and unmatched ease of deployment.
Cross–compatible with Ethereum, it allows for the deployment or migration of a dApp in just a few minutes, in a familiar environment and tooling. This significantly lowers the entry barrier for DeFi dApps launching natively on Scroll, from smart contract wallets and derivatives DEXes to isolated lending and RWAs protocols. Instant token swaps, higher LP yields, perpetual futures and options, real-time median spot prices, automated investing, and recurring payments - these are just a few examples of functionalities made possible on Scroll.
Scroll is on a mission to build out a robust infrastructure for DeFi’s first billion users. With TVL crossing $48M at the time of writing, its zk-EVM is poised to become a home for continued innovation and elevated UX. Several blue-chip projects have also deployed or bridged to Scroll, including a couple of Uniswap front-ends and SushiSwap.
Scroll’s DeFi ecosystem is rapidly expanding, forming a lively and collaborative community. Here’s a quick overview of applications launched recently with us (the list is continuously updated at https://scroll.io/ecosystem).
Symmetry - Derivatives DEX
Amplify your trading profits with up to 25x leverage and portfolio margin:
Get portfolio margin with multi-asset collateral
Earn extra yields when depositing USDC, plus 70% of trading fees
Single Liquidity Pool with Multiple Yields
Splatter - DEX
A comprehensive dApp hub offering various services for traders:
X starter for fair and transparent token launches
X swap for secure trading
X portfolio for asset management
Instant peer-to-peer swaps, low fees, and no price slippage.
MYX - Perpetual DEX
Matches long and short traders and takes on net exposure:
Beginner-friendly UX
Deep liquidity, no price slippage
Higher LP yields
Up to 50x leverage
Rollie - Perpetual DEX
Trade crypto and RWA perps:
low fees
real-time median spot prices
single USDC vault for all trading pairs.
up to 1000x leverage
prediction markets (coming soon)
Cog Finance - Isolated lending protocol
Easy deployment of permissionless pools
Protocol-Owned Liquidity (Tinkermaster) for user protection and liquidity support
Multi-hop routing for efficient borrowing and lending paths
Partial Liquidations for better risk management and liquidity health
Exponential IR Collection to prevent exploitation in inactive pools
LoanShark - Risk-isolated lending protocol
Still in beta, the protocol’s structure offers superior capital efficiency:
Lend and borrow ETH, USDC, and USDT at X APY
Allocate your assets into an isolated LSD pool and earn a yield
Self-custodial smart contract wallet
Dedicated to the highest security standards, with multiple audits by reputable firms, and a bunch of useful features:
Manage your digital assets in one place.
Set up automatic investing and recurring transfers.
Delegate trading to sub-accounts.
Soulwallet - Smart contract wallet
Pay for gas fees using ETH, stablecoins, or any other ERC-20 token
Set up a guardian for social fund recovery
One-Click Secure Swap and 2FA for extra security
LazyOtter - Security
A risk intelligence layer to secure your investment by closely monitoring and informing you of incoming threats.
ISSUA - RWA
Enables creation, minting, and trading of synthetic assets mirroring various real-world and crypto assets:
Overcomes limitations of centralized solutions and high collateral requirements of existing decentralized systems.
Offers a novel method for minting synthetic assets: deposit stable coins and receive both long and short tokens (no need for a central counterparty ensuring adequate collateral).
