Vitalik Buterin, co-founder of Ethereum, has made it his personal mission to find solutions to network saturation. Now, it is the high demand for non fungible tokens (NFT) that causes it and makes the rates skyrocket.
As a proposal, Buterin has put forward a solution which is to migrate NFTs to second layers of Ethereum, such as rollups. He would not do it to a single rollup, but through an interoperability system that allows NFTs to be used in several of these.
The Russian-Canadian developer suggests the creation of “rolled NFTs” or wrapped-NFTs. These could be mobilized and traded between the different Ethereum rollups.
The rollups are second-layer solutions that basically “roll up” multiple transactions into one, and thus allow a larger number of transactions per second (TPS) to be processed outside of Ethereum’s main Ethereum network. For example, zkSync 2.0 rollups, which are currently in the testing phase, promise to process up to 20 thousand TPS, while the mainnet only processes between 12 to 20 TPS in its current state.
Based on the above, the main point of Buterin’s proposal lies in the non-reliance on a single rollup. While these offer reduced fees, using a single rollup can be counterproductive, since in the event of a failure, the NFTs would be trapped.
Using multiple rollups avoids this dependency model. Also, in case of failure, through the proposed system, the trapped TFNs could be migrated to another rullup or to the main chain.
Exchanging “rolled-up” NFTs
As mentioned, the Ethereum creator’s proposal is based on the creation of wrapped-NFTs (WNFTs). These, in a practical sense, would be tokens that represent other tokens within the rollup. The original WNFT would be stored directly on the Ethereum blockchain via a smart contract that would serve as a security vault.
What’s interesting about this concept is in the mobility of the WNFTs as they are transferred. For example: John “rolls up” a WNFT and sends it to the Arbitrum rollup. In this, Ivan decides to buy it. Ivan would be buying the WNFT and not the original NFT. However, according to Vitalik’s proposal, the transfer would generate an exchange receipt.
When Ivan wants to claim it on the main chain, he would only have to present the voucher so that the vault can
to change the owning address of this NFT from John to Ivan.
In the event that a chain of exchanges happens within a rollup, the last WNFT holder who decides to claim it will have this chain of exchange tokens and that will give validity to the holding of the NFT to claim. This also applies to NFTs that are transferred between rollups
, which would also generate vouchers.
Vitalik Buterin’s proposal presents challenges for implementation
One of the main challenges within this model proposed by Vitalik Buterin is that not all rollups currently operating on the Ethereum network will be able to be used. It is necessary for the rollup to make use of Ethereum’s EVM or virtual machine, which is basically the one that allows the execution of smart contracts
In a report made by CryptoNews, it was learned that rollups
like Arbitrum and Optimism allow the full use of the EVM. On the other hand, zkSync 1.0 does not allow full execution, which limits the smart contracts that can be deployed in them.
Another obstacle is in the adoption and implementation of this model across all NFT platforms. For now, NFT platforms are mostly based on the Ethereum mainnet. Using rollups can mean an operational cost for adoption and migration of their NFTs. Platforms may not be willing to bear that cost.