L2 in Blockchain: TEE Sidechains vs ZK Rollups

Industry InsightsDecember 15, 2022
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Scaling Blockchain with Layer 2 Solutions

Traditional blockchain networks are made of a mainnet. However, to solve big issues such as lack of scalability and high volumes of energy usage, layers were created on top of the said main one. This additional infrastructure is called Layer 2 (L2). It offers developers a more scalable, fast, and less costly logic.

Let’s say L1 is the network’s “nervous system”. Computations processed in L2 can be independent of the mainnet, allowing for faster and sometimes even autonomous processes. If you are in one part of town and the bridge to the other side is jammed, taking a ferry would get you there faster. That’s the basic idea of L2 solutions.

One of the main reasons for the emergence of these was to try solving some major issues of blockchain technology: lack of scalability and high fees, especially when there were too many transactions taking place at the same time in the mainnet.

Rollups: Optimistic & Zero-Knowledge

Ethereum has created its own Layer 2 version, called rollups. Simply put, a rollup is a set of transactions compressed into one, and then acknowledged by the mainnet as a single transaction, which means their execution will be processed faster. This alleviates pressure from the mainnet, making the whole process faster, and cheaper. The execution process is independent of L1 while still relying on it for security, data fetching, and funds.

There are two popular kinds of rollups: optimistic and Zero-Knowledge (ZK). While optimistic ones are easier to set up and use, ZK’s are less prone to attacks. They depend on cryptographic proofs to instantly verify if said transaction is valid, while optimistic ones work on an assumption basis, automatically granting the transactions as valid, allowing batches to be processed without any computation.

Sidechains: Pegged Connection

A sidechain is also a Layer 2 solution, but it’s independent of the mainnet. These separate blockchains have their own consensus protocols and have their security measures defined by their validators. They are naturally more centralized, but just like rollups, sidechains are great to speed up transactions and relieve pressure from the mainnet. A sidechain connects to the main chain through a two-way peg, meaning there’s a data exchange: once assets are unlocked in the sidechain, the same amount is locked in the main chain.

Integritee: Powering Sidechains with TEEs

At Integritee, we’ve developed sidechains that support multiple validators operating within Trusted Execution Environments (TEEs) — a hardware-encrypted area of a CPU securing data in use. The added value of our sidechains is that once verified, all validators can trust each other because they are operating within a secured area — the TEE — thus enabling sub-second block times with up to 2,000 TPS on each sidechain. In combination, this provides a cumulative capacity of up to 1 million TPS over the entire Integritee Network for well-shardable use cases.

Computations done inside TEEs can be independent and isolated from the mainnet, thus providing developers with a set of attractive benefits: scalability, confidentiality, and the flexibility of choosing which privacy features they wish to add. Integritee is using TEEs to provide builders with more scalable, secure, and autonomous deployments. When building with us, you will:

  • Be able to keep what you choose hidden through cryptographic keys
  • Prevent third parties from seeing or tampering with the information stored inside
  • Search for encrypted and sensitive data
  • Execute and deploy code with complete privacy.
  • Public auditability — through remote attestation — that what’s running inside the TEEs is, in fact, what you believe.

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