What’s Remarkable About Aztec’s Hybrid zkRollup?

Key Points:

• Aztec Labs is developing a hybrid zero-knowledge rollup that will allow smart contracts to be executed in a private, trustless, and scalable way.
• The solution will integrate for both public and private usage.
• The network plans to merge private and public execution in one ZK rollup.

After many notable changes, Aztec recently announced its new approach in the field of Layer-2 scaling. The solution this time introduced by the project is Aztec Hybrid zkRollup.

What is Hybrid zkRollup?

The data on Ethereum is open to the public, however, many data and transactions need confidentiality. Aztec created a transparent + privacy hybrid zkRollup based on this. Everyone is aware of the notion of a hybrid vehicle, which uses both gasoline and electricity to power a vehicle.

Aztec recently developed the hybrid zkRollup idea after the closure of Aztec Connect. The network plans to connect Ethereum smart contracts with zk encryption execution in the future. Assume the prior Aztec Connect was just for private digital asset exchanges. In that situation, Aztec zkRollup’s future application scope will be broader, including the privacy computation and transfer of all data.

Many argue that the unexpected move is because the project is concerned about many harsh policies directed at privacy projects when many governments are concerned that these products can support illegal transactions. As can be seen, Aztec’s Hybrid zkRollup approach is partly to mitigate the effects if there are any unexpected changes to the law in the near future.

Aztec will include all of the functionality of Ethereum smart contracts, as well as the security features of programmable anonymity, data privacy, and confidentiality contracts. Aztec significantly broadens the scope of what may be done on the blockchain by permitting public-private collaboration.

Roadmap

Aztec has begun the deployment of the basic contract (Milestone1.0), and the present components of the local development environment have achieved great progress. In Q3 2023, developers will have access to a local testnet, and consumers will have access to a complete public testnet in early 2024.

How does it work?

Aztec leverages prior Connect architecture work and vastly enhances its breadth and capabilities. Connect formerly used an encrypted UTXO design. The same idea will be used in Aztec, but with one important difference: UTXO may represent any data, not only “token value.” Smart contracts may now be stored entirely in UTXOs.

Connect previously only supported three custom circuits. In both public and private states, thew network can enable arbitrary smart contract logic. As a result, developers will have access to the whole set of Ethereum use cases, as well as totally new cryptographic applications. Connect is exclusively meant for DeFi, while Aztec considerably increases creativity.

The public and private state environments in Aztec are entirely composable, which means that any function may call any other function. This gives rise to totally new blockchain paradigms, such as privacy-to-privacy function calls, in which the logic of a smart contract is transparent to blockchain observers and may contact other contracts with invisible logic.

Aztec is constructing a complete privacy ecosystem: a network of smart contracts capable of fetching and writing to whatever ledger is most convenient:

A transparent, public ledger to enable native protocols that need transparency, such as AMMs and loan protocols.
An invisible private ledger that allows for the development of private decentralized government, money, identification, and games.

Aztec maintains the same separation of viewing and spending keys as Connect, but extends viewing key rights to each contract for fine-grained data access management.

Since it provides for contract-by-contract permissioning, compliance may be done in a variety of ways using novel blockchain primitives such as decentralized identification, third-party verification, and view key sharing.

The network provides a complete range of programmable private rights, eliminating the need for all-or-nothing methods in applications.

It broadens the design area for what you can develop… You can create apps where the purpose isn’t merely privacy, but where you need to hide information to perform what you need to do.

Gambling, like private voting in DAOs or conducting private trades on public automated market makers, might be one of these things (AMMs).

The company is also building its own privacy-focused smart contract programming language, called as “Noir,” to assure the enabling of private smart contract computing.

Noir will be a universal zero-knowledge circuit language meant to validate any cryptographic backend. It will be totally open source.

Not a zkEVM. Why?

The project says Aztec is an environment for processing transactions, integrated with Zero-Knowledge (ZK) technology. However, Aztec insists that it has no intention of moving in the direction of zkEVM (like many notable recent projects).

Ethereum is, at its core, a state machine. It starts with a state, then organizes transactions by block, and transitions the state deterministically. Aztec enlarges the global state machine to include private states. This hybrid public-private state machine supports both public and private smart contract logic execution. Simultaneously, it no longer performs transactions like a typical blockchain but rather verifies the validity of already computed transactions. To put it another way, Aztec is a zero-knowledge execution environment but not zkEVM.

Explaining the “Hybrid” approach, Aztec said it combines the scalability of applications thanks to Ethereum’s account-based network management and UTXO mechanism, which helps ensure protect the privacy of many classic blockchains like Bitcoin. With this combination, programmers can write contracts similar to the experience on Ethereum but still ensure security features.

An early conclusion was obtained when exploring privacy smart contracts at Aztec Labs: privacy is incompatible with the EVM. The brilliance of Rollup technology is that it does more than merely replicate Ethereum.

Aztec provides the potential to secure anonymity at the base layer while still providing the security assurances of Ethereum. At the time of its creation, Ethereum sacrificed anonymously in exchange for public consensus. It wasn’t until Zac Williamson and Ariel Gabizon released Plonk, the first zkSNARK with wide applicability for blockchain applications, in 2018 that it became viable to accomplish trustless, private execution using sophisticated zero-knowledge cryptography.

However, account-based public blockchain models like Ethereum are unable to enable native privacy, while UTXO-based privacy solutions are unable to support the ecosystem of apps and tools developed for public smart contract platforms.

Aztec integrates public and private execution into a single zkRollup, allowing for the seamless composition of encrypted and non-encrypted transactions. If Ethereum’s innovation is the ability to read and write to the public state, Aztec’s innovation is the ability to read and write to both the public and private states. Mixing public and private Rollups into a single hybrid Rollup allows use cases for secrecy and audibility such as:

• Private Voting for Public DAOs
• Private Game Sessions
• Trades in Private on Public AMMs

Aztec formerly only enabled private asset transactions, but it now also enables private smart contract execution, and smart contracts are more flexible in terms of compliance and viewing rights.

Conclusion

Users may now implement private contracts on Aztec’s local system, with the public side of the technology still under development.

Hybrid combines application scalability owing to Ethereum’s account-based network management with the UTXO mechanism, which offers the privacy guarantee of many traditional blockchains like Bitcoin. With this combination, programmers may build contracts that are to the Ethereum experience while yet comparable security features. Regarding its performance, we still need time to review.

DISCLAIMER: The information on this website is provided as general market commentary and does not constitute investment advice. We encourage you to do your own research before investing.

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Harold

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