Scaling DeFi with ZK Rollups: Design, Deployment, and Evaluation of a Real-Time Proof-of-Concept

TL;DR

This paper explores the design, deployment, and real-world performance of ZK Rollups in DeFi, demonstrating significant throughput improvements and analyzing security and integration challenges.

Contribution

It provides a detailed technical analysis and a practical proof-of-concept implementation of ZK Rollups for DeFi applications on Ethereum.

Findings

ZK Rollups can process up to 71 swaps per second.

Compared to Ethereum's 12 transactions per second, ZK Rollups significantly improve throughput.

The study discusses security trade-offs and future integration directions.

Abstract

Ethereum's scalability limitations pose significant challenges for the adoption of decentralized applications (dApps). Zero-Knowledge Rollups (ZK Rollups) present a promising solution, bundling transactions off-chain and submitting validity proofs on-chain to enhance throughput and efficiency. In this work, we examine the technical underpinnings of ZK Rollups and stress test their performance in real-world applications in decentralized finance (DeFi). We set up a proof-of-concept (PoC) consisting of ZK rollup and decentralized exchange, and implement load balancer generating token swaps. Our results show that the rollup can process up to 71 swap transactions per second, compared to 12 general transaction by Ethereum. We further analyze transaction finality trade-offs with related security concerns, and discuss the future directions for integrating ZK Rollups into Ethereum's broader ecosystem.