Metis: The strongest dark horse in the Layer 2 competition?

Author: Ac-Core, YBB Capital researcher; Translation: 0xjs@金财经

Foreword

Layer2 is considered to be the "orthodox" expansion path of Ethereum, but Metis has been Labeled "MEME Layer2" because the founding team of Metis is rumored to be "Vitalik Buterin's mom/best friends." Metis has been dubbed “MEME Layer 2,” undoubtedly a direct attack on investors’ orthodox belief in Ethereum. However, the essence of blockchain is still "code + finance". From an investment perspective, technology and market have always been a pair of happy enemies. Can Metis take advantage of other Rollups' lack of centralized orderers and its own strong economy? Model, stand out among many Layer2 projects?

Introduction to Metis

Natalia Ameline on the left and Elena Sinelnikova on the right

According to the official Metis website, Elena Sinelnikova, co-founder and CEO of Metis, has been committed to promoting education and popularization of the blockchain industry. She is one of the co-founders of the educational non-profit organization CryptoChicks, which is currently the world’s largest female blockchain community with members in 56 countries. Another co-founder of CryptoChicks is Natalia Ameline, the mother of Ethereum founder Vitalik Buterin. Additionally, Vitalik Buterin’s father, Dmitry Buterin, led the creation of Blockgeeks, a blockchain education company dedicated to developing courses related to blockchain technology. Metis Network was established in 2018 and launched in May 2021.

Metis is Layer 2 based on the Ethereum chain, following the same principles as other Layer 2, and is the earliest fork of Optimism. Its biggest attraction is that it is the first Optimistic Rollup to successfully decentralize the sorter. . The network uses a PoS sequencer pool to ensure continued network availability, resistance, and enable fee sharing and sequencer commitment. These sequencers are responsible for determining the order in which transactions are packaged and must obtain at least 2/3 signatures from the sequencer pool before data can be packaged and uploaded to the Layer 1 network. To prevent malicious behavior by the sequencer, Metis also introduces the role of a validator, which samples blocks to ensure that the sequencer orders transactions correctly.

The advantages of MPC (multi-party computation) are privacy protection and decentralization, and it is very effective for simple Boolean operations. However, the obvious disadvantage is that there are no relay nodes to distribute information, the number of communications increases, and the communication cost within the network increases significantly. In a blockchain network that requires consensus, this disadvantage will be more obvious. Overall, Metis transforms a single point orderer into a set of orderer pools to allow decentralized orderers to reach consensus to complete signatures, and achieves decentralization through a node staking mechanism and a rotation mechanism, which may not ultimately be Requires much lower network costs than Layer1, but can achieve MEV resistance + solve the single point of failure problem, and at the same time distribute benefits to node stakers. However, neither Metis’ MPC solution nor Radius’ public memory pool solves the problem of decentralized orderers placing a burden on the network and ultimately passing the cost on to users.

The recent surge in Metis TVL has drawn attention to the importance of decentralized orderers, and according to L2BEAT data, the OP scheme currently ranks fifth among TVLs among all Layer 2 networks. In addition to market value considerations, the author believes that most Metis solutions are reasonable and are a standard decentralized sorter solution. The design intention is both to actively distribute the pie and to demonstrate to the market the value capture of Layer 2 native tokens, which is not limited to gas fees and governance.

Source: L2BEAT data time 24/02/01

Three elements of Rollup

Rollup is one of the Layer2 solutions, also known as Rollup. It extends the performance of Ethereum by migrating transaction calculation and storage performed on the Ethereum mainnet (i.e., Layer1) to Layer2 for processing and compression, and then uploading the compressed data to the main Ethereum network.

Rollup can be divided into ZK Rollup and Optimistic Rollup, depending on the scheme used to ensure the validity of the compressed data (that is, the correctness of the data). It involves on-chain computing, where transactions are packaged onto the chain for verification and accounting every few minutes, hence the name. However, even though we usually call it a Rollup chain, the off-chain part of Rollup is not a complete blockchain, but just a bunch of transactions packaged to form a Rollup transaction, and all nodes receiving the Rollup transaction do not execute the packaged logic, and only the execution result of that logic is executed.

Source: Author

Sequencer

Sequencer is responsible for transaction processing in Layer2 Role in sorting, organizing, packaging and submitting to the Layer 1 network. Currently, most Layer 2 projects rely on a single sequencer (usually the project itself) to complete the above work. This also has two security issues: 1. Single point of failure. If the sequencer has problems due to attacks or technical failures, the entire The network will be shut down; 2. Scalability issues, a single sequencer may be unable to cope with the increasing transaction volume.

Validation

During the transaction process, the packaged data sent by the sequencer needs to be verified. Currently, most of the verification of Ethereum Rollup is performed by the Ethereum Rollup smart contract to ensure the reliability of the data. There are two different verification methods: ZK Rollup (Zero Knowledge Rollup) and Optimistic Rollup.

For example:

ZK Rollup:

Verification method: ZK Rollup uses zero-knowledge proof to verify all transactions that occur on Layer2 correctness. Zero-knowledge proof allows the verifier to confirm the validity of a transaction without knowing the details of the transaction;

Privacy: ZK Rollup emphasizes user privacy because the calculated "proof" is submitted at Layer1, and Not the details of the transaction. The details of the transaction are executed on Layer2, while Layer1 only verifies the validity of the zero-knowledge proof.

Optimistic Rollup:

Verification method: Optimistic Rollup adopts an "optimistic" strategy, assuming that all transactions are legal and verifying only when necessary time verification. Verification is performed through fraud proofs, where proofs about transaction violations on Layer2 are submitted at Layer1;

Real-time: Since all transactions are assumed to be legitimate, transactions on Optimistic Rollup can be completed quickly, only on Verification in case of dispute or disagreement.

DA (Data Availability)

DA, or Data Availability, publicly publishes the status data of each transaction off-chain so that other participants can also access and use this transaction status data. Some Layer2 writes transaction status data to Ethereum Layer1 to achieve DA. There are also Rollup-Layer2s that write transaction-critical data to third-party blockchains, where data availability assumes that the data is trustworthy. For example:

DA in Optimistic Rollup: Ensure that the data of all transactions on Layer2 is available on Layer1. If the data is not available, anyone can raise an objection on Layer1, which helps prevent potential data tampering or omission;

Commitments in ZK Rollup: All transaction calculations and storage are done in Layer2, but only the calculation results (called commitments) are submitted to Layer1. Prove these commitments to be true using zero-knowledge proofs.

Note: In ZK Rollup, "Commitment" focuses on verifying the correctness of the calculation results of transactions on Layer2, while "Data Availability" focuses on ensuring that Layer1 can access the data of all transactions on Layer2. Usually the two are complementary to ensure the security and reliability of the entire system.

Among the three key elements of Rollup, the sequencer is considered the most critical. The sorter is responsible for sorting and compressing Layer 2 transaction information off-chain. Since this process involves verification of data trustworthiness, achieving data reliability verification and availability may not be as critical when the sequencer is decentralized.

Metis decentralized sorter based on POS consensus

Source: MetisL2

Sorter Selection

Metis Rollup improves the "Transaction Data Verification Committee" by introducing a role called "Verifier" in the Layer2 calculation process and motivating verification nodes to quickly verify transactions through a competitive mining mechanism. . It achieves this by introducing the "verifier" role in the Layer 2 calculation process and motivating verification nodes to quickly verify transactions through a competitive mining mechanism. Similar to other Layer 1 networks that use a proof-of-stake (POS) mechanism, transactions on Metis need to be verified by nodes. Therefore, there will be no gaps or delays in withdrawing assets from Metis to the main Ethereum network.

A significant difference of Metis Rollup compared to Optimistic Rollup is that it only takes a few hours or minutes to withdraw assets from Metis to the Ethereum L1 layer. This highlights the advantages of Metis Rollup in terms of efficiency and speed in processing transactions. In general, the higher the stake, the higher the probability of a node joining the sequencer. Of course, there is also a certain random element in this.

MPC (Multi-party Computation) of the sorter

Metis’ decentralized implementation of the sorter involves three key roles: administrator (Admin), sorter and POS-based consensus layer.

Administrator: Responsible for setting key parameters for the entire network and managing the addition of sequencer qualifications to the pool. The parties no longer have absolute control over these matters directly, but are instead executed by the administrator after the proposal has been verified. One of the difficulties in achieving decentralization is that the sorter must be managed in a decentralized manner while maintaining efficiency and convenience;

Sorter: Metis uses MPC (Threshold Signature Scheme) based on TSS ( Multi-party computation) signature to manage the signing permissions of multiple sequencers. Each sequencer has the right to decide a Batch, and all sequencers participate through MPC signature. If the number of signatures exceeds 2/3, the batch is considered valid and can be submitted to the Rollup contract on L1. MPC signatures performed by the sequencer pool are managed by another contract based on the POS network. When the POS network cannot detect the MPC address, the MPC module is triggered to generate a key;

POS-based consensus layer: The POS network is responsible for managing contracts with sequencer signature authority, monitoring MPC addresses and triggering key generation . The generated keys are sliced ​​and distributed to each sequencer in the pool for MPC signing. The settings of this module include key life cycle management, including multi-signature generation, key re-sharing, application signatures and deletion signatures;

The reason for using TSS is its high fault tolerance and flexibility. Compared with multi-signature, TSS does not need to verify each signature on the chain, but aggregates the signatures of all signers and conducts unified checks, thereby increasing the transaction confirmation rate. Additionally, communication between POS nodes uses independent Tendermint channels, while MPC runtime communication uses the libp2p protocol. The entire system is designed to enable efficient and secure decentralized management of sequencers.

Metis sequencer transaction process

1. The initial user initiates a transaction; 2. The transaction is forwarded to the sequencer network node; 3. Block generation: when the sequencer accepts the transaction When it is valid, create a block; 4. Completion: MPC nodes discuss the merging of the block and forward it to the Ethereum main chain.

MetisEDF

Metis Ecological Development Fund (MetisEDF) provides financial support for this, covering multiple aspects, such as incentivizing the development and deployment of protocols, providing liquidity support, and conducting security audits and implement liquidity mining plans. Allocation includes:

Sorter Mining: 65.4% (3 million METIS / >260 million USD);

Ecosystem Funding: 34.6% (1.6 million METIS / >US$140 million).

Sorter centralization problem

Source: Author

The principles of Ethereum are Each node stores and executes every transaction submitted by users. This high level of security also makes the entire network very expensive, so it is necessary to expand the capacity of the entire network and adopt a Rollup solution. Simply put, Rollup = a set of contracts in Layer1 + its own network node in Layer2, that is, on-chain smart contracts + off-chain aggregator, which relies on Ethereum for settlement, consensus and data availability, and is only responsible for executing Rollup itself.

• The smart contract on the chain indicates that its trust model is a smart contract on Ethereum. Borrowed from the security of Ethereum;

• Off-chain aggregators execute and aggregate transactions off-chain, compressing large volumes of transactions and eventually placing them on the main Ethereum network to Enable faster, cheaper transactions.

Layer2 network node has multiple components, among which the sequencer component is the most important. It is responsible for receiving transaction requests on Layer2, deciding their execution order, and packaging the transaction sequence into a batch, which is ultimately transmitted to the smart contract on Layer1. While all Layer 2 Rollups on Ethereum have centralized orderers, Metis has taken the opportunity to become a decentralized orderer.

A Layer2 full node can obtain the transaction sequence in two ways: directly from the sequencer or by reading the transaction batch sent to Layer1 by the sequencer, but the latter has a stronger immutable property. Since transaction execution will change the state of the blockchain's distributed ledger, in order to ensure consistency, Layer 2 full nodes must synchronize the distributed ledger state with the sequencer, in addition to obtaining the transaction sequence. Therefore, the task of the sequencer is not only to send the transaction batch to the Rollup contract of Layer1, but also to pass the state update result StateRoot/StateDiff after transaction execution to Layer1. Overall, the job of the sequencer is to process and order transactions into blocks to be added to the blockchain, and is responsible for processing transactions in batches and publishing them to the Layer 1 smart contract.

For the Layer2 node, as long as the transaction sequence on Layer1 and the original StateRoot of Rollup are obtained, the Layer2 blockchain ledger can be restored and the latest StateRoot can be calculated; on the contrary, the Layer2 node itself calculates The StateRoot is inconsistent with the StateRoot published by the sequencer to the Layer1 smart contract. means the sorter is fraudulent. To sum up, Layer1 is more decentralized, trustless and secure than Layer2’s own network.

For example, Optimistic Rollup allows all Layer2 nodes to provide Fraud Proof, proving that the data published by the sequencer in Layer1 is incorrect. But for Optimism without Fraud Proof, if it really wants to steal Layer2 users’ assets through the sequencer, it only needs to let the sequencer operator forge transaction orders and transfer other people’s assets from Layer2 to its own assets. Can. address, and then finally transfer the stolen coins to Layer1 through the Bridge contract that comes with Rollup.

Thoughts on Metis

The biggest Layer 2 hype recently is undoubtedly the Cancun upgrade, but this is not the only good news for Metis, but is generally applicable. “Vitalik Buterin’s mom/best friend” sentiment aside, the biggest competition between Metis and other Layer2s is decentralized orderers and economic models under PoS, and TVL shows the overall market capitalization feedback of the market’s confidence in Metis users .

Unlike other Layer 2s that control their own funds and return more benefits to users, OP Rollup’s economic model is strongly controlled and centralized, and the OP tokens are rewarded to the ecosystem to stimulate development and interaction. In order to profit from the Gas price difference, Metis will hand over its profit interests to the staking community for competition, greatly unleashing the financialization of Layer 2 infrastructure and attracting widespread attention from the market.

MEME represents more of a culture and some socio-economic factors, just like when we buy MEME, in addition to its investment expectations of ten times, a hundred times or even a thousand times, but more The process comes from our recognition and love for MEME. Its narrative and various factors, but always pulling the market is justice, Metis's growing TVL is also a feedback from the market on its investment expectations. Putting aside the technical aspect, if we consider the attribute issue from the market perspective, if Inscription is the tester of public chain performance, then MEME is to a certain extent the touchstone of market recognition.