What is StarkNet? Overview of the Layer 2 solution

1. What is StarkNet?

StarkNet is a layer 2 scaling solution for the Ethereum blockchain that uses ZK Rollup technology. StarkNet is developed by the technology company StarkWare.

Any Dapp can develop smart contracts on StarkNet without needing permission. Dapps developed on StarkNet will benefit from StarkNet's transaction speed, low costs, and the security of Ethereum.

Unlike other layer 2 solutions, StarkNet uses its own language for product development called Cairo. This language allows developers to scale, deploy dApps, or smart contracts in any field. All protocols or dApps built on StarkNet will use Cairo.

2. Mechanism

StarkNet is a ZK Rollup solution, in which zero-knowledge proofs (specifically, STARKs) are used to verify the validity of Rollup blocks.

The operational phases of StarkNet rollup are as follows:

Step 1: Roll up transactions

Users sign transactions and send them to StarkNet Operators.
Operators aggregate the transactions into Batches and send them to L1.
Operators are the only entities allowed to create L2 blocks and add rollup transactions to the ZK-rollup contract.

Step 2: Submit transaction data to Ethereum

Transaction data is sent to Ethereum as calldata to reduce gas costs

Step 3: Verify proofs

The ZK Rollup operator sends the latest state information of the Rollup to Ethereum.
The prover generates a STARK proof, a cryptographic commitment verifying the accuracy of the batch transactions.
ZK Rollup uses validity proofs to confirm the correctness of off-chain transactions without re-executing the transitions on Ethereum.
Upon successful verification, the block is added to the main chain of the Ethereum network.

3. StarkNet products

StarkNet's main products are

Cairo Programming Language: StarkNet uses the Cairo language, which allows developers to scale, deploy dApp, or smart contracts in any field. All protocols or dApps built on StarkNet will use Cairo.
StarkGate Bridge: This is StarkNet's native bridge that facilitates asset transfers between Ethereum and StarkNet.
StarkNet Stack Toolset: The StarkNet Stack is a framework for developing Appchains using StarkNet's zk technology. Using the Starknet Stack, Appchains can be customized to meet their specific requirements and goals.

4. StarkNet updates

*Updates on StarkNet's techniques and technology from 2022 to September 2023*

One positive aspect of StarkNet is its commitment to continuously improving its products through updates. The latest update, Quantum Leap, significantly increases the transactions per second (TPS). StarkNet aims to achieve three-digit TPS instead of the previous 10 TPS. Currently, the Quantum Leap update has recorded 37 TPS, and in a testing environment, it has sometimes nearly reached 100 TPS.

5. Advantages of StarkNet

5.1. Differences compared to Optimistic Rollups

StarkNet has several advantages over Optimistic Rollup, including:

Transaction validation time: ZK Rollups are faster than Optimistic Rollups because they do not require a 7-day waiting period to verify the accuracy of transactions.
Capital efficiency: Deposits and withdrawals on ZK Rollups also do not experience the 7-day delay seen in Optimistic Rollups, enhancing capital efficiency.

5.2. The feature of Account Abstraction (AA)

StarkNet is a leading project in Account Abstraction technology, which serves as a gateway to attract new users. Users utilizing wallets with Account Abstraction will find the experience familiar, akin to Web 2.0 platforms.

In December 2022, VISA announced that StarkNet is a solution that could bridge the gap between cryptocurrencies and the real world. Following this information, there were speculations that VISA might choose StarkNet's Account Abstraction to expand its payment methods.

*Visa recommends using StarkNet for automated payments*

Key features of StarkNet Account Abstraction include:

Multi-transaction Signing: Users can bundle multiple transactions into a single signing process, simplifying the execution of complex orders on decentralized derivative exchanges (DEXs).
Transaction Fee in Various Tokens: StarkNet's Account Abstraction allows transaction fees to be paid in a variety of tokens, not just $ETH, enhancing flexibility for users.
Seamless Experience: With StarkNet Account Abstraction, users can set session keys to improve usability and streamline the signing process.
Real-time Asset Transfer Tracking: As a smart contract wallet, StarkNet Account Abstraction provides real-time tracking of asset transfers, unlike traditional wallets that often show transactions as 'pending' without detailed updates.
Account Recovery: Users can pre-set permissions to recover accounts in case of lost private keys, enabling recovery through new devices or via authorized access methods like Gmail.

6. The StarkNet ecosystem

Currently, the StarkNet ecosystem is still quite nascent, with many projects in the testnet phase. This is a golden opportunity for enthusiasts to participate and explore StarkNet's features from the early stages.

Despite being in early stages, StarkNet has immense potential for development given its diverse product portfolio spanning DeFi, Wallet, Infrastructure, Gaming/NFT, and more.

StarkNet's Total Value Locked (TVL) is currently relatively low compared to its project potential, ranking sixth among Layer 2 solutions with a TVL of $128 million.

7. Roadmap

StarkNet is developed in four main phases:

Phase 0: Foundation

StarkWare has completed the establishment of several key foundations for StarkNet, including the Cairo programming language and the Generic Proof Service (GPS).
Phase I: Planets: Single-App Rollups

This step will enable developers to build and deploy their own scalable applications on StarkNet.
Phase II — Constellations: Multi-App Rollups

In this phase, StarkNet will support multiple applications running on the same StarkNet instance and accessing a unified global L2 state. This capability enables interaction between different applications and reduces gas costs through improved economic scalability. At this stage, StarkNet will be a fully functional framework for running multiple applications with any arbitrary business logic on Ethereum, each instance operated by a single operator.
Phase III — Universe: A Decentralized Rollup

The final step in StarkNet's development process is decentralizing its operations.

In the upcoming phase, StarkNet is developing updates v0.13.0, v0.14.0, and v0.15.0. These upgrades will focus on reducing transaction costs and increasing transaction speed.

8. Tokenomic

8.1. General information

Token name: StarkNet
Token symbol: STRK
Blockchain: Ethereum
Contract address: 0xca14007eff0db1f8135f4c25b34de49ab0d42766
Token utility: Utility, governance
Total supply: 10,000,000,000 STRK
Circulating supply: 1,300,311,845

(Information compiled as of June 15, 2024)

8.2. Token feature

Governance

Token holders of STRK have the privilege to vote directly or delegate their votes on all protocol changes to ensure the operation, security, and maintenance of StarkNet.

Transaction fees

In the future, STRK will be used to pay gas fees on StarkNet instead of Ethereum (ETH) as it is currently.

Staking

The staking mechanism aims to ensure the security and stability of StarkNet.

8.3. Token allocation

The allocation of STRK tokens is as follows:

Grants: 12.93%
Donations: 2%
Early contributors: 20.04%
Treasury: 8.1%
Investors: 18.17%
StarkWare: 10.76%
Provision: 9%
Rebates: 9%
Reserve: 10%

8.4. Token payment schedule

9. Team

Đội ngũ phát triển StarkNet — *StarkNet development team*

Eli Ben-Sasson: Co-Founder and Chairman of the Board at StarkWare. He co-invented the Zerocash decentralized anonymous payment system and is a founding scientist of Zcash.
Uri Kolodny: Co-Founder and CEO of StarkWare. He holds a Bachelor's degree in Computer Science (Magna cum Laude) from the Hebrew University and an MBA from MIT Sloan. Previously, Uri was an Entrepreneur in Residence (EIR) with two Israeli VC firms and an analyst at McKinsey.
Michael Riabzev: Co-Founder and Chief Architect at StarkWare. He holds a Ph.D. in Computer Science from the Technion Israel Institute of Technology, focusing on the development and deployment of zk-STARK systems. Michael has 14 years of software development experience, including at Intel and IBM research labs.
Alessandro Chiesa: Co-Founder and Chief Scientist at StarkWare. He co-invented the Zerocash protocol and is a founding scientist of Zcash.
Additionally, the StarkWare team comprises 40 talented and experienced engineers in the blockchain industry.

10. Partners and investors

StarkNet is developed by the technology company StarkWare, aiming to be a layer 2 scaling solution for the Ethereum network utilizing ZK Rollup technology.

Since 2018, StarkWare has raised $282.5 million through 7 funding rounds from 33 investors, including Ethereum Foundation, Paradigm, Sequoia Capital, Alameda Research, Coatue, and Greenoaks.

11. Project communication channel

12. Conclusion

Here is all the information about the StarkNet project that Theblock101 wants to provide to you. StarkNet is one of the Layer 2 projects built on Ethereum, having raised $282.5 million from major funds and valued at $8 billion. It is a promising project for those looking to participate in retroactive gains. In upcoming upgrades, transaction fees will be reduced and transaction speeds increased, making it an opportune time for enthusiasts to engage in cost-effective retroactive StarkNet

Read more: